This case is an illustration of the importance of identifying the pre-transfer ‘activities’ in a service provision change under Reg. 3(1)(b).
The case concerned the provision of adult care packages. S provided residential services for the Council up to 2012. After 2012 it did so under a framework agreement with other providers but remained the major provider.
As at July 2016 S provided 168 care packages to service users. It divided up the geographical area covered by the contract with the Council into 4 districts. East 1, East 2, West and Central so that service users would tend to have the same carers visiting their home. By the date of the transfer each care package lasted on average 9 months. S terminated the contract in July 2016.
The Council proposed that 4 transferees would undertake the work that S had undertaken; PC, LC, KE and CW. The Council decided to allocate care packages to each of the providers based on post code (i.e. it did not follow the district allocation of S). In some cases all a carers’ work went to one of the new providers. In other cases that work was split between more than one of the new providers. S decided that if one provider had more than 50% of the work of a carer it would allocate the carer to that new provider.
The ET Judgment
The parties could not agree what the activity was.
The employees said the provision of adult homecare to individual service users, or clients, pursuant to spot contracts (i.e. standalone separate contracts for each service user), in accordance with individual service delivery agreements known as Care Plans.
S said the activity was the provision of a package of care to a number of service users within the Borough.
CW said the activity was the provision of the Adult Social Care Services but that the identity of the client on whose behalf of whom the services were carried out was not clear.
LC said that the determination of the identity of the clients for the purposes of Reg. 3(1)(b)(ii) must precede a determination of whether the conditions of Reg. 3(1)(b) and Reg 3(3A)(1) are met. It suggested three possibilities of the Council as client, the individual service user as a client, and both the Council and individual service users as client in combination. The activities was in general terms the provision of adult home care to individual service users.
The EJ held that the client was the Council. The relevant activity was the provision of adult homecare to individual service users in accordance with the care plans to a number of service users.
The effect was that the employees transferred to new providers as transferees.
The EAT Judgment
Two transferees appealed. Their case was that this was a fragmentation case and no employees should have transferred. They also appealed on the basis the judge erred on the issue of organised grouping.
The EAT (Supperstone J) allowing the appeal held:
- That the EJ had not reached a clear conclusion as to what the activity was. She had rejected the argument that each care plan was an individual contract but beyond that it was not clear whether she held that the activity consisted of the entire contract with the Council, or a subset of it.
- Fragmentation was an issue that should have been considered at the point the EJ considered whether the activities carried on by the subsequent contractor after the relevant date were fundamentally or essentially the same as those carried on by the original contractor. Here this issue was considered when considering whether there was an organised grouping. That was an error.
- In rejecting the case for fragmentation, the EJ had held that the re-allocation of service users was based on postcodes. However, there was no evidence that one contractor took on the majority of the work; and in relation to a number of employees it was difficult to establish where the employment should transfer given that various service users went to different contractors. Whilst S’s work generally was organised on a regional basis, post-termination the Council-funded work was divided on the basis of both capacity and postcode.
- The EJ erred on the issue of organised grouping. She had made no finding as to whether such a grouping existed, whether it was deliberately formed and if so that was deliberate or conscious.