The issue in this case was whether the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) apply to staff transfers between commissioning bodies in the NHS.
The case concentrated on the contractual rights of NHS employees whose employment was transferred to Integrated Care Boards (ICBs) from Clinical Commissioning Groups (CCGs) in 2022. The key question was whether the transfer of the CCG's commissioning functions to the ICB constituted a "service provision change" under TUPE. If it did, the CCG employees' terms and conditions would be protected on transfer to the new service provider.
TUPE safeguards the rights of employees when the business they work for is transferred to a new employer, ensuring that they retain their employment terms and are protected from detriment due to the change in employer. TUPE applies in two circumstances: business transfers and service provision changes, where (in either case) there is a transfer of an "economic activity".
The EAT in this case focused on the question of whether CCG commissioning functions were economic activities, to which TUPE would apply when those functions transferred to ICBs.
Facts
Dr Bicknell, represented by the British Medical Association (BMA), had been employed as a Clinical Advisor by Nottingham City Clinical Commissioning Group (NC CCG). When Nottingham and Nottinghamshire Integrated Care Board (NN ICB) replaced NN CCG, Dr Bicknell was made redundant as part of the reorganisation. Dr Bicknell then challenged this decision, arguing that his employment should have transferred under TUPE and that his dismissal was therefore automatically unfair.
The Employment Tribunal (ET) concluded that TUPE did not apply to these circumstances as NN CCG was not engaged in "economic activities" as it was commissioning services under a statutory duty, rather than delivering them.
Dr Bicknell, represented by the British Medical Association (BMA), had been employed as a Clinical Advisor by Nottingham City Clinical Commissioning Group (NC CCG). When Nottingham and Nottinghamshire Integrated Care Board (NN ICB) replaced NN CCG, Dr Bicknell was made redundant as part of the reorganisation. Dr Bicknell then challenged this decision, arguing that his employment should have transferred under TUPE and that his dismissal was therefore automatically unfair.
The Employment Tribunal (ET) concluded that TUPE did not apply to these circumstances as NN CCG was not engaged in "economic activities" as it was commissioning services under a statutory duty, rather than delivering them.
Dr Bicknell and the BMA appealed on the following grounds:
- The ET had misunderstood the test of "economic activity" as set out in the 2019 EAT case of Nicholls v London Borough of Croydon;
- The ET had misunderstood the meaning of "public administrative functions" (which are exempt from TUPE under regulation 3(5)); and
- The ET failed to identify and overlooked all of the relevant "activities" of NN CCG or to give adequate reasons for excluding them as "services".
The EAT rejected Dr Bicknell and the BMA's appeal, relying on the decision in Nicholls that commissioning by a CCG does not qualify as an economic activity for the purposes of TUPE unless the CCG is also directly providing goods or services on the market. Since that was not the case, TUPE did not apply to the transfer of the CCG's commissioning functions.
What does this mean for employers?
This case is relevant to bodies in the NHS (and other public services) which commission services but do not directly provide them. NHS bodies that are involved in direct service provision is very likely to be an "economic activity" for the purposes of TUPE. TUPE will therefore apply to transfers of services between NHS providers, or to transfers of services between NHS and other providers. Even if it is likely that TUPE does not apply in a particular case, employers should still engage in full consultation with employees and unions regarding the impact of organisational change and any potential mitigations, as a matter of policy and good practice.
Dr Marcus Bicknell and the BMA v NHS Nottingham & Nottinghamshire Integrated Commissioning Board
