This case does not concern any new principle but is another example of an unsuccessful perversity appeal in a Service Provision Change (SPC) case and relates to the issue of whether the same activities were carried on ‘before’ and ‘after’ the transfer – in the context of inadequate performance of the activity after transfer.
B was employed by CSV as its project coordination manager. She was responsible for recruiting, training, screening and supporting volunteers towards becoming Independent Visitors. The Council has statutory duties under the Children Act 1989 to appoint Independent Visitors to befriend and advise vulnerable children (as defined). The Council appointed CSV pursuant to a contract to discharge their statutory duty. The contract was due to come to an end and B was at the time subject to disciplinary action. Another supplier, Action for Children, was unwilling to take on the contract with B in place. B was then dismissed for redundancy by CSV on 31 March 2011. As of the 1 April 2011 no replacement supplier was in place and, although it did not wish to do so the Council took the service back in house. Five months later it engaged Action for Children to undertake the service on a different and much reduced basis. When the Council took over the service it spent less time on the service than CSV. The recruitment aspect of the service also became somewhat neglected with a reactive approach being taken by the Council. A Council employee was given the task of dealing expenses of the Independent Visitors and another employee was given as a point of contact. The ET held that there was an SPC notwithstanding that there was unsatisfactory performance and under resourcing of the service by the Council.
The ET held at a PHR that the activities, having been performed by a contractor, had now been brought back in house within the meaning of Reg 3(1)(b)(iii).
The Council mounted a perversity appeal submitting that the ET had failed to adequately identify the activities carried out by CSV and failed to take account of differences between the activities it carried out and those carried out by the Council which it was argued were not similar and/or had been fragmented.
The EAT restating (yet again) that whether or not there is an SPC is a question of fact (see Metropolitan Resources Ltd v Churchill Dulwich Ltd). The issue which the EAT identified was whether imperfect performance of the activities after the transfer meant that there was no SPC. The EAT held that just because, by reason inadequate performance and under resourcing, certain parts of the service had not been performed or performed adequately was not sufficient to hold that there was not an SPC. The EAT drew an interesting analogy by pointing out that when a canteen changes hands, the work may decline because people may not want to go to the new provider; it does not change the character of the service being provided or of the activities being provided just because on accepting the change not all of the activities can be carried out. The ET made findings of fact and it is not the function of the EAT to second guess this.