In Tapere v South London and Maudsley NHS Trust, the EAT has given guidance on the operation of mobility clauses in the context of a TUPE transfer, and considered the application of Regulation 4(9) of TUPE 2006, which deems an employee to have been dismissed if, as a result of a transfer, they suffer a substantial change to their working conditions, to their material detriment.
Ms Tapere transferred under TUPE from Lewisham Primary Care Trust to South London and Maudsley NHS Trust (SLM Trust) and, as a result, was required to change her place of work. This change involved additional travel, and would interfere with Ms Tapere's childcare arrangements. She raised a grievance prior to going on holiday, however, upon her return, she found that the transfer had taken place, and her colleagues relocated. She resigned, claiming constructive dismissal. Ms Tapere also claimed her dismissal came under Regulation 4(9), on the basis that the location change was a substantial change to her conditions which was to her material detriment.
Ms Tapere's claim failed at an employment tribunal. It held that SLM Trust had not breached her contract in requiring her to change her place of work, as a mobility clause in her contract with the transferor survived the transfer and allowed SLM Trust to transfer her between its locations. The wording in the mobility clause specifying that it operated "within the Trust" was superfluous. In relation to Regulation 4(9), the tribunal held that, from an objective viewpoint, there had not been a substantial change in Ms Tapere's conditions to her material detriment.
The EAT disagreed. It held that:
- in relation to the mobility clause, the words "within the Trust" were not superfluous, and restricted the operation of the clause to the employer at the time the contract was entered into. It rejected a "substantial equivalence" argument put forward by SLM Trust that the mobility clause should be interpreted as covering its workplaces after the transfer;
- in relation to Regulation 4(9), whether there had been a substantial change in working conditions was a question of fact to be determined by reference to the nature, as well as the degree, of change. It did not have to be considered uniquely from an objective or subjective viewpoint;
- whether such a substantial change was to the material detriment of the employee must be considered from the employee's point of view. It did not require the objective weighing up of the view of the employer versus the employee. The question is whether the employee views the change as detrimental and whether this is a reasonable position for the employee to take;
- the transferee employer was, therefore, in breach of contract in altering Ms Tapere's place of work, and she was deemed to have been dismissed by operation of Regulation 4(9).
Impact on employers
- This decision confirms that the bar for establishing a claim under Regulation 4(9) of TUPE is set quite low. Transferee employers will not only have to ensure that pre-transfer contractual terms are honoured, but also consider carefully any change in working conditions that might occur as a result of the transfer and whether it could, in the view of a reasonable employee, amount to a substantial change to their material detriment.
- This case is particularly important for transferee employers who want to relocate employees after the transfer takes place. The transferee will be bound by any existing mobility clauses, which will remain unchanged by the transfer, and interpreted in accordance with the parties' intention when the contract was entered into. It will not be possible to invoke the concept of "substantial equivalence" to widen such provisions.
- Transferee employers wishing to use mobility clauses to transfer employees, or implement any significant change to working conditions, are advised to consult with the affected employees and take all objections into consideration. In particular, employers must consider whether the employee's position is a reasonable one for them to adopt.