Claimant v Cunningham and others v Care Preference Ltd — 2024

The tribunal heard three linked claims for a payment in lieu of accrued but untaken holiday leave on termination of employment. The Respondent accepted that the Claimants left its employment on 1 October 2023 and had accrued but untaken leave, but said their employment transferred to their former client under TUPE with their holiday entitlement.

The tribunal found that the Respondent had been the original contractor providing care services to the client, that the activities before and after 30 September 2023 were fundamentally the same, and that there was an organised grouping of employees whose principal purpose was to provide the care activity for one client. It found that the Claimants were assigned to that organised grouping and that none of the exceptions in regulation 3(3) applied. A relevant transfer by way of a service provision change had therefore taken place.

Because regulation 4(1) of TUPE prevents termination of employment on a relevant transfer, the tribunal held that there was no termination on which a claim for payment in lieu of accrued holiday could be founded. It therefore found the claims were not well founded and failed. The tribunal noted that the liability to provide leave had transferred to the new employer.

The tribunal referred to Enterprise Management Services Ltd v Connect-Up Ltd and ors 2012 IRLR 190 when setting out the approach to a service provision change, including identifying the activities, considering whether they remained fundamentally the same, and then considering whether there was an organised grouping assigned to those activities.