The recent case of London Borough of Hillingdon v Gormanley and others UKEAT/0169/14, served as a useful reminder of how easy it is to go wrong when deciding which employees transfer on a service provision change.
This particular case concerned three managerial employees of the same family who carried out painting and decorating work for the housing stock operated by the London Borough of Hillingdon.
The Employment Appeal Tribunal (EAT) overturned the Employment Tribunal’s decision that the employees were assigned to a grouping of employees that transferred to the client on a service provision change.
The Employment Tribunal (ET), said the EAT, had been mistaken in focusing on the fact that the service provider was only doing work for one client which was merely down to chance as it had worked for other clients in the past. Instead, the ET should have considered the organisational framework within which the employment relationships of the employees took effect and what the employees were required to do under their contracts.
This provides helpful guidance when dealing with managerial employees who may be involved in both servicing the client and running the business.