The ECJ has issued its ruling in Celtec v. Astley on the issue of whether
there is a particular point in time at which an undertaking is deemed to have
transferred in accordance with the TUPE regulations, or whether a gradual transfer
may take place over a period of time.
The case concerned civil service employees performing vocational training
and enterprise activities who were seconded to a Training and Enterprise Council
(TEC) to carry out the same tasks. After three years, they resigned from the
civil service, thereby ending their secondments, and immediately signed up
to fresh contracts with the TEC. The TEC argued that the TUPE transfer had
taken place at the time of the secondment and so, at the time of the transfer
they remained employees of the civil service. On this basis, the TEC refused
to recognise continuity of employment. Following this line of argument, the
employees were not taken on by the TEC until three years later. The employees,
on the other hand, argued that the secondment formed part of the transfer process
which took place gradually over the three-year period.
The ECJ ruled that it is not possible for a transfer to take place over a
period of time. For the purposes of legal certainty the claimants must be able
to point to a specific date at which the transfer is alleged to have taken
place. The date of transfer is to be determined as the date on which the employer's
responsibility switches to the transferee with references to the circumstances
in each case. This precludes employers from postponing or agreeing the date
on which the contracts of employment transfer, rather this will be a matter
of fact which may be objectively determined.
The ruling leaves in doubt the issue of transfers occurring as a series of
two or more transactions, as provided for in the TUPE regulations.