In Bicknell v NHS Nottingham and Nottinghamshire Integrated Commission Board, the Employment Appeal Tribunal (EAT) confirmed, following the EAT’s previous decision in the case of Nicholls v London Borough of Croydon, that the commissioning activity carried out by Dr Bicknell and others for the NHS was not an “economic entity” for the purpose of applying the employment protections of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (known as “TUPE”).
Dr Bicknell and others were affected when groups of commissioning bodies in the Nottinghamshire area of the NHS were merged together. The EAT had to decide whether TUPE applied to those mergers such to preserve (most of) the employment rights of the transferring employees and provide automatic unfair dismissal protection to those with over 2 years’ service.
They argued that the transfer of Dr Bicknell’s “group” had amounted to a business transfer. Under Regulation 3, broadly speaking, TUPE applies to:
- Transfers of business – the easiest example of which is the sale of part of a business to another business.
- Service provision changes – for example, where a service is outsourced to a contractor.
Intricate rules apply to decide the extent of TUPE’s involvement in such a situation.
Where there may have been a business transfer, TUPE will apply only where there has been a transfer of “an economic entity which retains its identity [in the hands of a transferee business]”.
According to these cases, pure commissioning activity (i.e. not consisting of offering goods or services on a given market), is not an economic entity. Dr Bicknell and the others affected only commissioned (and did not provide) healthcare services.
The door has clearly been left open for the Court of Appeal to consider this question further – see paragraph 64 of Bicknell.
This blog was written by Ben Lindsay, Solicitor at didlaw.
