The Court of Appeal agrees that clinical commissioning was not an “economic activity”, meaning TUPE was not triggered.
For there to be a relevant transfer under TUPE, there must be a “transfer of an undertaking”, where an “economic entity” transfers and retains its identity. Most employers won’t spend long pondering whether a transfer involves an “economic entity”. For example, a sale of a retail store as a going concern is most likely to be considered an “economic entity”; the store's ultimate purpose is to purchase and then sell goods for a profit.
However, a recent Court of Appeal decision has highlighted that the existence of an economic entity is not always straightforward.
TUPE defines an economic entity as “an organised grouping of resources which has the objective of pursuing an economic activity, whether or not that activity is central or ancillary”.
But what exactly does that mean? TUPE itself doesn’t give much more guidance, other than clarifying that it does not matter whether a company is operating for profit or not.
Case law has provided some further guidelines around what will amount to an “economic entity”; clarifying that there needs to be a stable economic entity which is sufficiently structured and autonomous. There also needs to be more than just a collection of assets, but in some cases the assets can simply be the employees (or even just a single employee).
However, there have been very few cases which consider the...
AT&T subsidiary Wisconsin Bell Inc. will pay $55 million to settle a long-running False Claims Act suit alleging it defrauded the Federal Communications Commission by overcharging schools and ...