Service provision changes 





Service provision changes are the second category of transfer to which TUPE applies. They were added to the TUPE regime in 2006, with the aim of protecting workers when a service contract changes hands, either through outsourcing, insourcing (bringing services back in-house), or second- generation outsourcing (a change from one provider to another) (regulation 3(1)(b), TUPE, as amended).




The TUPE protection provided on a service provision change exceeds the minimum requirements of the Acquired Rights Directive, plugging a gap in the protection provided under EU law. Here are the key features of a valid service provision change:




• there must be a change in the identity of a service provider (this means that there will be no service provision change, and therefore no TUPE protection from changes to terms and conditions, if the same contractor successfully bids to renew the contract);




• there must be no change in the identity of the client(s) who commission the services before and after the change of service provider (that is, the same client must contract for the services from the old and the new contractor);




• immediately before the transfer, there must be an “organised grouping of employees” whose “principal purpose” before the transfer was to provide the contracted services; 





• the “activities” carried on before and after the change of service provider must be “fundamentally the same”;




• the client must intend that after the change of service contractor, the services will be provided “other than in connection with a single specific event or task of short-term duration”; and




• the contract must be to supply services, not goods for the client’s own use.




Each of these tests are looked at below.