In Centinsoy & Others v London United Busways Limited [2014] the EAT confirmed that a change of location is not always a substantial change in working conditions to an employee’s detriment for the purposes of a claim under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE 2006).
Facts Mr Centinsoy and the three other claimants worked as bus drivers for CentreWest, on route 10 out of the Westbourne Park Depot. On 30 January 2010 route 10 was transferred under TUPE 2006 to London United Busways and the Westbourne Park depot became unavailable. Mr Centinsoy and his colleagues were therefore required to change depots to Stamford Brook.
The drivers’ transferred contracts identified their primary place of work as Westbourne Park, but included a mobility clause allowing this to be changed to alternative locations identified in an attachment to the contract. Stamford Brook was not one of those additional locations. The requirement to move to Stamford Brook was therefore a breach of contract. The new location was 3.5 miles away from Westbourne Park and resulted in additional travel time of between 30 and 60 minutes per day for the claimants.
Three of the claimants resigned in response to the change of depot. They claimed unfair dismissal on the grounds that the change amounted to a substantial change in working conditions to their material detriment, entitling them to resign and treat themselves as dismissed.
The Tribunal found that there was no repudiatory breach of contract, no substantial change to the employees’ working conditions and no consequent material detriment. There was therefore no unfair dismissal.
Law Regulation 7(1) of TUPE 2006 provides that a dismissal before or after a TUPE transfer will be automatically unfair where the sole or principal reason for it is the transfer itself or a reason connected with it which is not an economic, technical or organisational (ETO) reason entailing changes in the workforce.
The claimants relied on regulation 4(9) of TUPE 2006 which provides that where a TUPE transfer involves ‘a substantial change in working conditions which is to the material detriment of a person whose contract of employment is transferred’, an affected employee may resign and treat himself as dismissed by the employer.
Rights under regulation 4(9) are in addition to employees’ rights under regulation 4(11) to resign and claim unfair dismissal in response to an employer’s repudiatory breach of contract.
Decision The EAT upheld the Tribunal’s decision, while accepting that the Tribunal had given a ‘muddled’ judgment, particularly in its approach to fundamental or repudiatory breach. However the Tribunal judge correctly undertook a factual assessment of whether the transfer involved a substantial change to working conditions, by concentrating, not on the contractual terms, but on the change in working environment or way of working before and after the transfer.
Comment Kate Wyatt of Lindsays’ employment team comments: “The claimants in this case were influenced by the decision in Musse, which had found in very similar circumstances that TUPE 2006 had been breached by the change in working conditions. However, Centinsoy highlights that each case must be decided on its own facts and not just by reference to earlier decisions. It also emphasises that although claimants may believe that changes are to their material detriment and may be able to show detriment which is ‘not immaterial’, this will only be relevant if they have first shown that the changes were ‘substantial’. They failed to do so here.
“The case was decided before amendments to TUPE 2006 introduced by the Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 2014 came into force. These give employers another option for defending claims of automatically unfair dismissal under TUPE 2006 where there is a change of location post transfer. From 31 January 2014, under regulation 4(5A) of TUPE 2006, change of location may also be an ETO reason justifying an otherwise unfair dismissal.
“Incoming employers in a TUPE transfer who are obliged to change employees’ location, even in breach of contract, should take heart from this decision. Even if there is a significant change in working conditions, employers may still argue an ETO reason, without an overall reduction in staff under new regulation 4(5A). The increased flexibility to reorganise and restructure will be welcome.”
