Mr K Fulke and Mr K Reid v Wipro Ltd and others: 4104119/2020 and 4104158/2020
JUDGMENT
E.T. Z4 (WR) The Judgment of the Tribunal is that: -[1]the application by the claimants to add Wipro UK Ltd and Northgate Public Services (UK) Ltd as first and third respondents respectively to case no. 4104119/20 is granted;[2]case no. 4104158/20 is sisted; and[3]a preliminary hearing by telephone conference call should be fixed as soon as possible to consider further procedure.REASONS
[1]The history of these two cases is somewhat complicated. On 30 July 2020, the claimants’ solicitor submitted a claim form on behalf of both claimants against the three respondents (Case No. 4104119/20). The claimants brought complaints of unfair dismissal, for a redundancy payment and for notice pay. However, the claim form was rejected, in so far as it related to the first respondent (“Wipro”) and the third respondent (“Northgate”), as the wrong early conciliation numbers had been inserted for these two respondents. Accordingly, this claim only proceeded against the second respondent, Highland Council. That claim is defended.[2]The claimants’ solicitor did not apply for a reconsideration of the decision to reject the claims against the first and third respondent. Instead, on 3 August 2020 he submitted a fresh claim form against Wipro and Northgate (Case. No. 4104158/20). However, the particulars of the claim in the paper apart were in identical terms to the previous claim form, but, rather confusingly, there was still reference to Highland Council as the second respondent. Case management preliminary hearing[3]I conducted a preliminary hearing to consider the management of both cases on 27 October 2020. The Note which I issued following that hearing is referred to for its terms.[4]The first and third respondents submitted ET3 Response Forms in Case No. 4104158/20 in which their respective representatives both maintained that the claim was out of time. Helpfully, in the claim form at para. 15, the claimants’ solicitor had intimated that he accepted that the claim form had been presented out of time and requested that the Tribunal exercise its discretion to allow the claim to be lodged late.[5]At the preliminary hearing, the first and third respondent’s representatives confirmed that they were maintaining the time bar point. Accordingly, I directed the parties to make written submissions to the Tribunal on the point and advised that I would consider the point “on the papers” and issue a written Judgment with reasons in due course. Rule 34 Application[6]However, on 27 October 2020 at 16:16, the Tribunal received an e-mail from the claimants’ solicitor with an application, under Rule 34 of the Tribunal Rules of Procedure, to add the first and third respondents to the first claim (4104119/20).[7]The e-mail was received on the same day as the case management preliminary hearing but after the hearing had concluded. The claimants’ solicitor did not intimate at the hearing his intention to make such an application. In any event, the application was opposed by the first and third respondent but not opposed by the second respondent, Highland Council.[8]I decided that it would be necessary to consider and determine this application in the first instance. If granted, it would not be necessary to consider the time bar point in relation to the subsequent claim (number 4104158/20) as the first claim would proceed against all three respondents. However, were I to refuse the application it would be necessary to consider and determine the time bar issue. Claimants’ Rule 34 application[9]As I recorded above, the claimants’ solicitor made this application by e-mail on 27 October 2020 at 16:16. His e-mail is referred to for its terms.[10]In support of his application he referred to the following cases:- Selkent Bus Company Ltd v. Moore [1996] IRLR 661 Cocking v. Sandhurst (Stationers) Ltd [1974] ICR 650 Drinkwater Sabey Ltd v. Burnett [1995] IRLR 238 Gillick v. BP Chemicals Ltd [1993] IRLR 437 R (on the application of Buglife) v. Thurrock Thames Gateway Development Corporation [2-8] EWCA Civ 1209 Drake International Systems Ltd & Others v. Blue Arrow Ltd [2016] ICR[11]In his e-mail the claimants’ solicitor set out the background to his application. He accepted, insofar as the first claim (case no. 4104119/20) was concerned, that: “there was an error in transcribing the EC Certificate numbers on to the claim form in respect of both the first respondent, Wipro, and the third respondent, Northgate.” The claimants’ solicitor was instructed by the claimants at that time and he prepared the claim form. “Determination of R.34 Applications”[12]The claimants’ solicitor referred to the process to be followed as set down in Cocking. He submitted that these guidelines required to read in conjunction with the guidance from the EAT in Selkent.[13]He further submitted, with reference to Selkent, Drinkwater and Gillick, that: “The decision whether or not to add in parties is not a question of jurisdiction. This Tribunal would fall into error if it was to make any determination solely on the basis of whether or not it would have been reasonably practicable for the claim to have been submitted correctly against the two prospective respondents within the original deadline.”[14]He also made “two additional points”. The first was that: - “Had the original claim form been submitted today (27 October 2020) the claims against the two prospective respondents would have been accepted by the Tribunal. The Employment Tribunals (Constitution and Rules of Procedure) (Early Conciliation: Exemptions and Rules of Procedure) (Amendment) 2020 were laid before Parliament in September of this year and have now insofar as they are relevant to this application come into force) passed into law. The reason this amendment was made was that Parliament recognised that the automatic rejection of a claim on the basis the one typographical error in just one part of the claim was arbitrary, draconic, unfair and had led to a number of unnecessary appeals and preliminary hearings. There was no good reason why a typographical error in one part of a claim form would render the entire claim invalid whereas numerous typographical errors in other parts of the form would not.”[15]The second additional point related to the contention by the respondents’ representatives that the claimants would have a potential remedy against their advisers in the event that the second claim (Case no.4104158/20) was not accepted out of time. He submitted that:- “In the Employment Tribunal, as in all legal forums in Scotland, there is strong and overriding interest against the creation of satellite litigation. The Court of Appeal has said that ‘Courts should do their utmost’ to discourage satellite litigation (R (on the application of Buglife). This particular issue of satellite litigation in relation to the application of the Early Conciliation rules and strongly cautioned against by Langstaff J in Drake. While the Tribunal finding want of jurisdiction against the two prospective parties may entitle the claimants some form of remedy against their advisors, there will remain a claim in time against the respondent in the 4104119/2020 (sic). This creates a very serious risk of effectively the same substantive case being run in two separate courts concurrently. Such is the risk of injustice (along with additional, unnecessary expense being borne by the public) that the Tribunal should factor this into its consideration when determining the issue.”[16]The claimants’ solicitor then went on in his e-mail application to make the following submissions:- “Applying the Cocking principles to the current case: 1. A valid claim form was presented to the Employment Tribunal in respect of the current claim. 2. That claim was submitted within the original time frame. 3. The defect was caused by a genuine error in transcription (there appears to be no sensible basis upon which to suggest otherwise). It is therefore submitted that the Tribunal should use its discretion to add the two prospective respondents to this litigation. The error in transcription has caused no prejudice to the respondents whatsoever. The respondents received claim forms in identical terms within a matter of days. The respondents’ ET3 to this case is currently outstanding, therefore it is submitted that no progress has been missed and no delay to proceedings has been caused by application being made at this date. The error itself which led to the rejection was minor. The consequence of the error is that the Claimants may be left without remedy in the event that the Tribunal decides that they did not transfer to the respondent and instead was dismissed by one of the two prospective respondents. In determining whether or not to exercise its discretion, I would ask the Tribunal to have regard to the fact that, since the date of lodging, Parliament has acted to avoid future claims from being able to proceed on this basis. The distinction between the present claim and many of the claims in respect of which appeals have been brought, is that this claim was accepted in respect of a respondent. In consequence, unlike the claims which were rejected in their entirety, the Tribunal is not required to determine this issue on a jurisdictional basis (indeed, it would be in error were it to do so). In all the circumstances, granting this order would be wholly in furtherance of the overriding objective. The interests of neither fairness nor justice are served by allowing prospective respondents to evade any form of legal challenge purely on the basis of two typographical errors, particularly when the rules which led to such a draconic application of the law have since been identified and made more flexible by Parliament.” Second respondent’s response[17]The representative for the second respondent, Highland Council, intimated by e-mail on 11 November 2020 at 10:03 that she did not object to the claimants’ application under Rule 34. Third respondent’s response[18]The representative of the third respondent, Northgate, intimated by e-mail on 3 November 2020 at 11:58 that he objected to the claimants’ application under Rule 34. He said this:- “Firstly, we believe that the Tribunal should continue with the outcome of the preliminary hearing on 27 October 2020. Due to the way the Tribunal ordered, this appears to be nothing more than the Claimants’ representative attempting to have “second bite at the cherry” considering the directions laid down as to how the Tribunal is able to deal with this matter by written representations, despite the protestations of the Claimants’ representative. Clearly dealing with the matter in this way would be in line with the overriding objective and ultimately save the valuable time and resources of the Tribunal. Further, the argument below could have easily been raised by the Claimants’ representative at the time of the preliminary hearing, to allow the Employment Tribunal Judge to deal with it at the time. We strongly disagree therefore with the Claimants’ representative’s assertion that their application would save time and resources for the Tribunal. This is simply not correct and the factual reality is the complete opposite – this application (which could have been made at the time of the preliminary hearing and we would have expected a reputable firm of solicitors to have accordingly done so) is already requiring further resources from the Tribunal. So, we strongly disagree the granting of this application will save time and avoid delay as the Claimants’ representative states. In fact, if granted the application will undoubtedly mean a far longer time hearing is necessary for the Tribunal and with three Respondents as opposed to one, together with the additional administrative work for the Tribunal that comes with a case with three Respondents. At the Preliminary Hearing the Claimants’ representative admitted the error was on their part in terms of a typo, which ultimately it meant a limitation date was missed. We use our language carefully at this point, but believe most in the legal profession would agree that missing a limitation date amounts to negligence on the part of the instructed solicitor. At this point we should also highlight the Claimants’ representatives themselves. This is a nationally reputable law firm, and one well known for dealing with trade union cases. As we believe it, they were instructed throughout this matter, yet only choose to submit the Claimants’ claim one day before the limitation date. We would respectfully suggest that firstly a professional firm should not make such a typographical administrative error in any event, with the appropriate mitigation in place to avoid such serious errors, but fully appreciate mistakes happen. This is a reason law firms are required to have indemnity insurance in place to help when these such mistakes occur. However, unless they can prove otherwise, we believe there would have been no reason why the Claimants’ representative could not have submitted their claim earlier than the date submitted, and in which case had the typos then been found and the claim rejected, the Claimants’ representatives would still have enough time to resubmit within the original time limitation date. Whilst we understand and appreciate the claimants’ points re the Scottish judicial system’s intent to avoid satellite litigation, we would however respectfully put forward the intent of Parliament regarding the same was not to let potentially negligent parties “off the hook” in favour of continuing litigation against a party that has a genuine legal argument as to why the claim against them should be dismissed on the basis of jurisdiction. Finally, we note the Claimants’ representative appears to ask the Tribunal to look favourably upon this application due to the fact that the issue of errors with EC Certificates has been dealt with the revised The Employment Tribunal (Constitution and Rules of Procedure) (Early Conciliation: Exemptions and Rules of Procedure) (Amendment) Regulations 2020. We would respectfully point out these Regulations only came into force on the 8 October 2020, whereas the Claimants’ claim in question was initially submitted 30 July and then finally again on 3 August 2020, clearly before the effective date of the legislation referred to. Clearly it would be the incorrect approach in law to retrospectively apply a set of legislation prior to becoming effective in law.” Claimants’ response[19]Later that day, 3 November 2020, at 13:39, the claimants’ solicitor responded to the e-mail from the third respondent’s representative. He maintained, with reference to Beresford v. Sovereign House Estates & Another [2012] ICR (D9), that the third respondent is, “not a party to this litigation and therefore has no locus to object to this application.”[20]He submitted that the third respondent was only a party to the subsequent claim (Case No. 4104158/20) and had only been copied into the application “out of courtesy”.[21]For the avoidance of doubt, he advised that the application related to the first claim (Case No. 4104119/20), in which the second respondent, Highland Council, is the only respondent. Third respondent’s further response[22]The third respondent’s representative responded by e-mail on 11 November at 10:33 as follows:- “We would point out, as the Claimants’ representatives have done, the case law they provided pre-dates the current Employment Tribunal rules. As far as we interpret Rule 34, this allows the Claimants (or Tribunal for that matter) to add or remove an additional party but does not preclude that party from making objections to the application. Rule 34 contains the wording: “in the interests of justice” and we would respectfully submit that allowing the respondent to an application under Rule 34 is in accordance with this and the overriding objective in any event (sic). We maintain a better conclusion would to (sic) continue with the case as per the Tribunal’s discretion from the Preliminary Hearing on the 27th October 2020. It may be that the Tribunal wishes to consider the outcome of that case, and the written representations to be provided by the parties shortly before making a decision on the Claimants’ application below, but we shall let the Tribunal decide how they wish to proceed. We strongly believe this would save the Tribunal valuable time and resources and is again in line with the overriding objective.” First respondent’s objections[23]The solicitor for the first respondent, Wipro, intimated her objection to the claimants’ Rule 34 application by e-mail on 12 November 2020 at 07:58. The following are excerpts:- “Whilst it is accepted that both the First and Second Claims arise from the same set of facts, it was Thompsons’ decision to present the claim separately as they did, for consideration separately by the Tribunal. It is not disputed that the Second Claim is out of time. The Tribunal has ordered all parties to make representations relating to the time bar point separately; whether or not the Second Claim is permitted to proceed thereafter should have no bearing on the outcome of this application. What is relevant to this application however, is the existence of the Second Claim per se, a claim which Thompsons have confirmed in their e-mail is “in identical terms” to the First Claim. Given the existence of the identical Second Claim there should be no need to add the same Respondents to that Second Claim as Respondents to First Claim. Nor would it serve any useful legal purpose to do so, and would only likely cause confusion all round. It cannot be right that the Tribunal is being asked to add Respondents to a claim where the exact same claim against those Respondents already exist. But for the time bar issue with the Second Claim, Thompsons would not be requesting that our client or Northgate are added as Respondents to the First Claim. It is in our view, precisely as Mr Abel (the 3rd respondents’ representative) put it in his objection e-mail, a case of Thompsons ‘attempting to have second bite at the cherry’. Thompsons have suggested that the Claimants will have no remedy if our client and Northgate are not added as Respondents to the First Claim and it is found that the Claimants did not transfer under TUPE to the Respondent to that Claim, i.e. The Highland Council. That is emphatically incorrect. Both our client and Northgate are already parties to an identical claim, i.e. the Second Claim. The Claimants therefore have a potential remedy under the Second Claim. If the time bar point were not an issue, Thompsons would not be making this argument, as the Claimants would then have in-time claims against our client and Northgate covering the same subject matter. As Northgate’s representative has already pointed out, it follows that if the Second Claim is judged to be out of time and is not permitted to proceed (due to Thompsons’ failure to lodge the Second Claim in time) the Claimants’ remedy lies squarely against the lawyers preparing that Claim i.e. Thompsons. All law firms are required to have indemnity insurance precisely to provide their clients with a remedy in the event of negligence on the part of the firm.”[24]The First Respondents’ solicitor then made submissions regarding the submission of the “First Claim”, but these were predicated on a misunderstanding of the position. It is not necessary, therefore, for me to rehearse them here.[25]Finally, the First Respondent’s solicitor made the following submissions:- “Thompsons have suggested that as neither our client nor Northgate are parties to the First Claim at this time, neither has locus standi to be able to advance any objection to the Application. As Rule 30(2) of the Employment Tribunal (Constitution and Rules of Procedure) Regulations 2013 (“ET Rules”) provides, where a written application is made, the party making the Application “shall notify the other parties that any objections to the Application should be sent to Tribunal as soon as possible”. The wording of this rule does not stipulate that “the parties” in question need to be a party to the claim. Rather, a more logical and simple interpretation of the wording in this rule is that “the parties” are those concerned with or affected by the application. This would clearly include a party whom the applicant was seeking to add to add to a claim, particularly when in doing so, as here, the claims against that party would be out of time, the applicant had full opportunity to add those parties when it first presented the claim but deliberately chose not to do so, and the applicant had already brought separate proceedings against those parties concerning the same subject matter. It appears that Thompsons themselves initially interpreted Rule 30(2) ET Rules in this way when they first made their application, stating at the time “I confirm that both the Respondents and the prospective respondents’ representatives have been copied into this e-mail and remind them, should they have any objections to this request, they should make them to the Tribunal as soon as reasonably practicable.” It is clearly in the interests of justice under Rule 34 ET Rules that parties potentially affected by an application are able to advance representations for consideration. This also enables a case to be dealt with fairly and justly in line with the overriding objective in accordance with Rule 2 of the ET Rules. For all the reasons advanced, we confirm our objection to the Application. We confirm that we have copied all parties into this correspondence and look forward to hearing from the Tribunal in due course.” Discussion and decision[26]I was satisfied that the prospective first and third respondents had a right to object in accordance with the “overriding objective” in the Rules of Procedure and the interests of justice.[27]Having regard also to the “overriding objective” and the “interests of justice”, I decided to deal with the Rule 34 application first.[28]Rule 34, in Schedule 1 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (“the Rules of Procedure”), is in the following terms:- “34. Addition, substitution and removal of parties The Tribunal may on its own initiative, or on the application of a party or any other person wishing to become a party, add any person as a party, by way of substitution or otherwise, if it appears there are issues between that person and any of the existing parties falling within the jurisdiction of the Tribunal which it is in the interests of justice to have determined in the proceedings; and may remove any party apparently wrongly included.”[29]There is, therefore, a wide discretion under Rule 34 to add, substitute and remove parties to proceedings. This power, when read, in conjunction with Rule 29, can be exercised, “at any stage of the proceedings”, which can be even after the time limit for bringing a fresh claim against the respondent has expired.[30]The same principles apply to an amendment to add, substitute or remove parties to a claim as to any other sort of amendment.[31]In Cocking, Sir John Donaldson, when delivering the Judgment of the NRIC, laid down a general procedure for Tribunals to follow when deciding whether to allow substantial amendments. These guidelines have been approved in several subsequent cases and were re-stated in Selkent. In that case, the EAT emphasised that the Tribunal, in determining whether to grant an application to amend, must carry out a careful balancing exercise of the relevant factors, having regard to the interests of justice and to the relevant hardship that will be caused to parties by granting or refusing the amendment. Mummery LJ said this at pages 843 and 844:- “………………………………………………………………………………………. (4) Whenever the discretion to grant the amendment is invoked the Tribunal should take into account all the circumstances and should balance the injustice and hardship of allowing the amendment against the injustice and hardship of refusing it. (5) What are the relevant circumstances? It is impossible and undesirable to attempt to list them exhaustively, but the following are certainly relevant:-(a) The nature of the amendment. Applications to amend are of different kinds ranging, on the one hand, from the correction of clerical and typing errors, the additions of factual details to existing allegations and the addition or substituting of other labels for facts already pleaded to, to on the other hand, the making of entirely new factual allegations which change the basis of the existing claims. The Tribunal have to decide whether the amendment sought is one of the minor matters or is a substantial alteration pleading a new cause of action.(b) The applicability of time limits If a new complaint or cause of action is proposed to be added by way of amendment, it is essential for the Tribunal to consider whether that complaint is out of time and, if so, whether the time limit could be extended under the applicable statutory provisions e.g. in the case of unfair dismissal s.67 of the Employment Protection (Consolidation) Act 1978.(c) The timing and manner of the application An application should not be refused solely because there has been a delay in making it. There are no time limits laid down in Regulations of 1993 for the making of amendments. The amendments may be made at any time – before, at, even after the hearing of the case. Delay in making the application is, however, a discretionary factor. It is relevant to consider why the application was not made earlier and why it is now being made; for example, the discovery of new facts or information appearing from documents disclosed on discovery. Whenever taking factors into account the paramount considerations are the relative injustice and hardship involved in refusing or granting an amendment. The questions of delay, as a result of adjournment and additional costs, particularly if they are unlikely to be recovered by the successful party, are relevant in reaching a decision.” Present case “Nature of the amendment”[32]It was significant that the two respondents who the claimants’ solicitor wished to were parties to the first claim (case no. 4104119/20). While the claim was rejected against the first and third respondents they had been engaged in early conciliation and certificates had been issued for them. Also, the particulars of the claim were in identical terms to the subsequent claim (Case No. 4104158/20). “Applicability of time limits”[33]The application to add the first and second respondents was made by the claimants’ solicitor on 27 October 2020 which was outwith the three-month time limit which, the claimants’ solicitor accepted, as extended by early conciliation, expired on 1 August 2020. However, the case law makes it clear that this is but one factor to be weighed in the balance and, of course, the Tribunal has a discretion to allow an amendment. “The timing and the manner of the application/balance of prejudice and hardship”[34]While the application was out of time it was maintained by the claimants’ solicitor that he was not made aware that the first claim had been rejected against the first and third respondents until 3 August 2020. There was nothing to suggest that that was not so. The second claim form was submitted on that date and duly intimated to the first and third respondents who have now submitted response forms.[35]While the Rule 34 application could have been made earlier by the claimants’ solicitor, the principal issue is, “the relative injustice and hardship involved in refusing or granting the amendment”, as Mummery LJ said in Selkent.[36]Were I to refuse the amendment, the claimants may be deprived of pursuing a successful claim against either the first or third respondents. In that event, they may have a remedy against their solicitors whom but that is likely to be a lengthy, involved and expensive process.[37]On the other hand, were I to grant the application I am satisfied that the delay in making the application would not affect the cogency of the evidence. I am also satisfied that the first and third respondents will not be prejudiced in responding to the first claim form, as amended, as the second claim form was intimated to them by the Tribunal on 6 August 2020 and the particulars of the claim are in identical terms.[38]I decided, therefore, that the balance of hardship/injustice favours the claimant.[39]I arrived at the view, therefore, that the application should be granted. I was satisfied that this was in accordance with the “overriding objective” in the Rules of Procedure. I was satisfied that, by and large, the submissions by the claimants’ solicitor were well-founded (apart from his contention that the first and third respondents had “no locus to object”).[40]In arriving at this view, I was also mindful of the reason why the first claim form had been rejected. It was because of a minor typographical error. An error, which if made now, would not have resulted in the claims being rejected due to an amendment to the Rules of Procedure. I am satisfied, therefore, that in all the circumstances, it is also in the interests of justice to grant the application. Further procedure[41]Having made this decision, the first claim (Case No. 4104119/20) will proceed against all three respondents, as originally framed, and it is no longer necessary for me to consider and determine the issue of time-bar in the second claim (Case No 4104158/20) which can be sisted which will avoid any issue of res judicata arising.[42]With a view to saving expense and having regard to the overriding objective I direct that it will not be necessary for the first and third respondents to submit ET3 Response Forms in the first claim. As the particulars of claim are in identical terms, the ET3 Response Forms which they have already submitted in response to the second claim will be taken to be responses to the first claim. Case management preliminary hearing[43]There is clearly an issue now as to whether the TUPE provisions apply. I direct that a case management preliminary hearing be fixed, by telephone conference call, as soon as possible, to consider the following issues: - 1. How best to consider and determine the TUPE issue. 2. Whether that could be done by way of written submissions or whether a hearing “in-person” or remotely by Video Conference will be required. 3. Possible preparation of a Joint Statement of Agreed Facts. 4. Orders and Directions. 5. Any other relevant matters.The law
[44]She then referred to email correspondence from Brian Davidson, and Jon Shepherd, the second respondent’s ICT Project Manager and Head of ICT, respectively (P626-628). She submitted, “that demonstrates that the third respondent’s solution is not wholly cloud based and that it is incorrect to compare what the third respondent is providing to the likes of Microsoft or Amazon.” “Comments on the third respondent’s submissions”[45]While there was e-mail correspondence suggesting that the second respondent’s Head of ICT, Jon Shepherd was not convinced TUPE applied, she submitted that TUPE operates, “by matter of law and that a party’s mistaken view in the application of TUPE does not defeat a TUPE transfer from occurring.” In any event, it was submitted that it is now evident from the Agreed Statement of Facts (para. 12) that the second respondent has changed its position.[46]The first respondent’s solicitor also submitted that the fact that the “new agreement” with the third respondent is for just two computer systems, rather than three, did not mean, as the third respondent’s solicitor submitted, that the “relevant activities” had changed. There are three separate IT support service contracts for each of the three computer systems and two of these were awarded to the third respondent; the services provided haven’t changed; rather than one provider supporting all three contracts, the systems have been split between two providers; the contracts awarded to the third respondent, “constituted the greatest part of the work undertaken by the claimants.” It was also disputed, as the third respondent’s solicitor submitted, that the “CareFirst system took up 40% of the claimants’ time. At no time did the third respondent support that system and cannot therefore possibly know what proportion of the claimants’ time in fact went into supporting this system”. She also submitted that, “the first respondent, as the party actually servicing these computer systems and therefore better placed to know the reality here, maintains that the opposite was in fact true.”[47]While it was accepted that the “new contract offers access to a “shared platform”, it was submitted that, “the second respondent’s computer systems are still being supported and maintained by the third respondent, and as such, the services haven’t changed…… support and maintenance is required on each application instance for each customer.”[48]She further submitted that, “the second respondent did not per se “require” dedicated support, as the third respondent has suggested. Rather, it simply happened that the claimants were organised as they were to deliver the services promised under the contract with the second respondent.”[49]She submitted that the activities which the third respondent’s solicitor had listed as being done by the first claimant, “is the very same list that appears in both the NPS Housing Contract and the NPS Revs & Bens Contract as being activities the third respondent was to take on.” Although these activities may have been “automated”, that did not prevent a SPC change arising under TUPE.[50]She also submitted that the third respondent’s submissions suggested that “the software is bespoke for certain customers” However, “the second respondent has a similar bespoke solution and it is the software that is being maintained rather than the platform on which it is being run.”[51]While the third respondent, “may well have been the original supplier of the application, this did not negate the fact that the claimants were providing support and maintenance to the second respondent on the same applications that have now transferred to the third respondent.”[52]So far as the third respondent’s submission that a finding of a TUPE transfer “would open the floodgates” was concerned, it was submitted that, “the services are not simply the storage or hosting of the computer systems alone, as the third respondent seeks to make out. Rather, the services that are being provided are supporting and maintaining those computer systems and, it is this that has triggered the TUPE transfer in this case. Put simply, the services go beyond simply hosting applications.”[53]The first respondent’s solicitor further submitted, with reference to paragraph 9 of her submissions, that the third respondent’s solicitor, “seeks to once again confuse the act of hosting applications in the cloud and this being the service under discussion, with the actual service provided in the present case which is the maintenance and support of those applications that are being hosted in the cloud. There is a distinct difference that must be recognised here, and it may help the Tribunal to think of the ‘cloud’ as being the repository for computer systems and the service that is being provided as the maintenance/support of those systems.” Second respondent’s response[54]By e-mail on 8 July 2021 at 14:41 the second respondent’s representative advised that she did not consider it necessary to respond to the other parties’ submissions. Third party’s comments on the other parties’ submissions[55]The third party’s solicitor responded to the other parties’ submissions by email on 8 July 2021 at 14:33. First respondent’s submissions[56]The third respondent’s solicitor submitted that, “much of the first respondent’s submission is irrelevant to the real issue for the Tribunal to assess here, following OCS, namely whether the services pre-transfer are ‘fundamentally and essentially the same’ as the pre-transfer activities.” He referred to a further case namely, Enterprise Management Services Ltd v. Connect-Up Ltd & Others UKEAT/0462/10/CEA. In that case the “incoming contractor” decided not to tender for 15% of the overall contract and it was held that the services post and pre-transfer were fundamentally different.[57]So far as the present case is concerned, the third respondent only took on two of the three applications previously maintained by the first respondent which means that there was a 20% reduction “at the very least”. It was submitted therefore that, “if a 15% reduction in Enterprise is enough for the EAT to suggest TUPE should not apply, we would suggest that the Tribunal must come to the same conclusion here.”[58]Further, it was submitted, with reference to McTear Contracts Ltd v. Bennet & Others [2021] UKEAT0023_19_2502 and ISS Facility Services NV Govaerts C-344/18, that if I was persuaded that TUPE applied, “the liability should not solely be that of the third respondent given the fragmentation of the contract.”[59]Further, the third respondent’s solicitor submitted that the “difference in work” pre and post transfer had to be appreciated and that it was, “simplistic to say, as the first respondent has, that the pre and post transfer work was the “provision of computer support”. The relevant test, with reference to Metropolitan Resources, is “whether the activities carried on by the alleged transferee are fundamentally or essentially the same as those carried out by the alleged transferor. The answer to that question will be one of fact and degree…. and that it follows that a service provision change is not precluded by some minor difference or differences between the nature of the task carried on….. or in the way in which they are performed” and that a “common sense and pragmatic approach is required.” It was further submitted that in that case, “the EAT also indicated that in assessing whether the activities are similar, a more detailed rather than an ‘overview’ approach should be adopted (i.e. consideration should be given to the exact nature of the activities performed by each of the transferee and the transferor and the exact manner in which those activities are performed.) The key point we wish to point out here is the manner in which the activities are carried out. We have explained in detail in our previous submission that much of the work detailed in the claimants’ job descriptions is now automated and these tasks are automatically performed by the NEC Cloud platform on behalf of all customers using that platform (approximately 400). We believe that when this approach is compared with the roles and activities previously performed by the claimants it is not possible to conclude that the pre and post transfer activities are fundamentally the same.”[60]The third respondent’s solicitor then when on in his submissions, by way of response, to “illustrate” his position with reference to a “picture” which shows the “time taken to complete relevant work” which, he submitted, is “as strong an argument as you can make to highlight that the pre and post transfer activities are very different and could not be described as “fundamentally or essentially the same”.[61]He also submitted that the contention by the first and second respondents, “that the NEC Cloud is not a full cloud service as it requires a VPN to connect.” is “wrong”. “Every ‘cloud’ requires a way to connect to it and in any environment where this link needs to be secure (such as the handling of government data) a VPN is usually the desired choice but, to suggest that this is not a full cloud solution purely due to the fact that it requires a VPN to connect the cloud is a fundamentally flawed argument and shows a lack of understanding of the technology in question.” “The claimants’ submissions”[62]The third respondent’s solicitor disputed the contention by the claimants’ solicitor that the activities being carried out, namely, the provision of IT support, pre transfer on three systems, were the same as those being carried out post transfer by the third respondent on two systems. He submitted that, on the basis of Enterprise, “this must mean that the activities are not fundamentally the same.” Further, with reference to Salvation Army Trustee Co., “the activities should not be defined at such generality that they do not describe the specific activities at all. We would respectfully suggest that characterising the provisions of services as “the provision of IT support” by the claimants, does just that.” “Conclusion”[63]Finally, the third respondent’s solicitor said this:- “We would respectfully suggest that the issue for the Tribunal here is relatively straight forward. However, the issue is clouded with complex technological jargon and misuse of the same by the parties. It is already agreed between the parties that activities previously carried out by the claimants comprising at least 20% of their time were not covered by the service that is now provided by the third respondent. Following the precedent laid down in Enterprise Management, this alone should be enough to persuade the Tribunal the pre and post activities are not fundamentally the same. If this is not the case, the Tribunal should adopt the approach detailed in Churchill whereby it was suggested that consideration should be given to the exact nature of the activities performed by each of the transferee and the transferor and the exact manner in which those activities are performed. We respectfully suggest that if this approach is taken the only logical conclusion is that TUPE does not apply. To assist the Tribunal, we would use an analogy. The current on premise, dedicated infrastructure system that was in place with the first respondent is similar to taking a trip in a car. It is a dedicated means of transport and the car is able to go wherever the driver wishes it to. The driver can control the speed, direction, the number of passengers and a number of other factors in relation to the use of the car. The third respondent’s new system is like a train. There are multiple customers on the train, but it can only move in a certain direction. It is at the control of the train-driver and the passengers have no control over the direction and speed of the train. In this example we would respectfully suggest the two methods of transport cannot be said to be the same, even if the start and end destinations were the same. Both methods are getting someone from A to B but the manner in which they do cannot be said to be fundamentally the same. Following that logic, the services pre and post transfer cannot therefore be held as “fundamentally or essentially the same” and accordingly TUPE cannot apply in line with OCS Group, Churchill and Enterprise Management Services. We therefore would respectfully reiterate our request for the Tribunal to strike- out the case against the third respondent.” Discussion and decision[64]The issue in the present case was whether there had been a relevant transfer under the Transfer of Employment (Protection of Undertakings) Regulations 2006 (“TUPE”), because of a “service provision change” (“SPC”).[65]The extension of the definition of a “relevant transfer” to cover a SPC was introduced by TUPE in 2006. So far as the present case was concerned, the following provisions were relevant:- “3. A relevant transfer(1) These Regulations apply to – (a) ……………………………………………………………………………….. (b) A service provision change, that is a situation in which – (i) activities cease to be carried out by a person (“a client”) on his own behalf and are carried out instead by another person on the client’s behalf (“a contractor”); (ii) activities cease to be carried out by a contractor on a client’s behalf (whether or not those activities had previously been carried out by the client on his own behalf) and are carried out instead by another person (“a subsequent contractor”) on the client’s behalf; or (iii) activities cease to be carried out by a contractor or subsequent contractor on a client’s behalf (whether or not those activities had previously been carried out by the client on his own behalf) and are carried out instead by the client on his own behalf.(2) ……………………………. ……………………………………………………(3) The conditions referred to in paragraph (1)(b) are that – (a) immediately before the service provision change – (i) there is an organised grouping of employees situated in Great Britain which has its principle purpose the carrying out of activities concerned on behalf of the client; (ii) the client intends that the activities will, following the service provision change, be carried out by the transferee other than in connection with a single specific event or task of short-term duration; and (b) the activities concerned do not consist wholly or mainly of the supply of goods for the client’s use.”[66]As Reg. 3 is a creation of domestic law, rather than being EU derived, the “multi-factorial” approach to whether there has been a TUPE transfer, which continues to apply in a standard TUPE transfer, does not apply to a SPC. This was confirmed by Judge Burke Q.C. in Metropolitan Resources, to which I was referred. In his view, the circumstances in which a SPC is established are, “comprehensively and clearly set out in Reg. 3(1)(b) itself and Regulation 3(3):- The introduction of Reg.(3)(1)(b) enables a transfer to be established in any of these three situations if the activities previously carried out by the client or contractor have ceased to be so carried out and, instead, are carried out by a contractor or a new contract or by the client…………………………………. If there was immediately before the change relied upon, an organised grouping of employees which had as its principal purpose the carrying out of the activities in question, the client intends that those activities will be carried out by the alleged transferee, other than in connection with a single specific event or a task of short-term duration, and the activities do not consist totally or mainly of the supply of goods for the client’s use, and if those activities cease to be carried out by the alleged transferor and are carried out by the alleged transferee, a relevant transfer exits. In contrast to the words to define transfer in the 1981 Regulations the new provisions appear to be straightforward; and their application to an individual case is, in my judgment, essentially one of fact…….there is no need for a judicially prescribed multi- factorial approach…… 29. In a case in which Regulation 3(1)(b) is relied upon, the Employment Tribunal should ask itself simply whether on the facts, one of the three situations set out in Regulation 3(1)(b) existed and whether conditions set out in Regulation (3) are satisfied.” Relevant activities[67]Reg. 3(2)(A) is in the following terms:- “ References in paragraph (1)(b) to activities being carried out instead by another person (including the client) are to activities which are fundamentally the same as the activities carried out by the person who has ceased to carry them out.”[68]The greater focus of the case law has been on whether activities remain the same in the hands of the new contractor. This was the main issue in the present case. When considering this issue I remained mindful that in Metropolitan Resources Judge Burke Q.C. emphasised that when comparing the activities of the alleged transferor and transferee, detailed differences will be inevitable and it could not have been intended that the ‘new concept’ of a SPC should not apply because of “some minor difference”. In his view, “a common sense and pragmatic approach is required”.[69]In Salvation Army, to which I was also referred, HH Judge David Richardson, in the EAT, expressed the same view: “the activities must be defined in a common sense and pragmatic way……..one the one hand, they should not be defined at such a level of generality that they do not really described the specific activities at all…….on the other hand, the definition should be holistic, having regard to the evidence in the round, avoiding two narrow a focus in deciding what the activities were……..a pedantic and excessively detailed definition of ‘activities’ with this defeating the purpose of the SPC provisions.”[70]Further, in Johnson Controls Ltd v. Campbell & Another UKEAT/0041/12/JOJ the Honourable Mr Justice Langstaff (President) said that, “identifying what an activity involves is an holistic assessment by the Tribunal. The Tribunal is trusted to make that assessment. Its evaluation will be alert to possibilities of manipulation, but it is not simply to be decided by enumerating tasks and identifying whether the majority of those tasks quantitively is the same as the majority one prior to the putative transfer.” Present case[71]What then of the present case? The question for me was whether the activities before and after the purported transfer were fundamentally the same. That question was one of fact and degree. The technology involved in the activities and the terminology used did not make the determination of this easy. However, I found the guidance of HHJ Peter Clark in Enterprise Management to be of particular assistance. This was summarised in the head note to the case report in the IRLR as follows:- “To determine whether a SPC arises under Reg.3(1)(b)(ii), the first task is to identify the relevant “activities” carried out by the original contractor. The expression is not defined in the Regulations. The next critical question is whether the activities carried on by the subsequent contractor after the relevant date are fundamentally or essentially the same as those carried on by the original contractor. This is essentially a question of fact and degree. Minor instances may properly be disregarded. Cases may arise where the division of services after the relevant date, known as fragmentation, amongst a number of different contractors means that the case falls outside the SPC regime, as explained in Kimberley (Kimberley Group Housing Ltd v. Hambley & Others [2008] ICR 1030).”[72]Two services namely “Housing” and “Revs&Bens” transferred to the third respondent. I am satisfied that the third respondent is still providing the same underlying services to the second respondent, the Highland Council, that the first respondent, Wipro, did before it. I am satisfied that that is so notwithstanding the fact that the third respondent provides the services using a “Cloud based server environment”. I am satisfied that the submissions on behalf of the claimants and the first and second respondents, in support of their contention that the relevant activities carried on by the third respondent, “the subsequent contractor” are “fundamentally or essentially the same” as those carried out by the “original contractor”, the first respondent, are wellfounded. It was significant that Highland Council, the recipient of the services, is of that view.[73]The fact that fewer employees may now be required by the third respondent to carry out these activities is nothing to the point. If that is so, it will be open to the third respondent to engage in a redundancy process and rely on Reg.7(2) “that there is an ‘economic technical or organisational reason entailing changes in the workforce.”[74]The “floodgates argument” advanced by the third respondent’s is also nothing to the point. I found favour with the submissions by the claimant’s solicitor in this regard that this has, “no basis in law” and that, “potential policy implications should not influence the Tribunal’s approach to its adjudication of this matter.” Identifying the activity[75]It is necessary to focus on the activity and what this is. This was considered by the EAT in Johnson. I am satisfied that the submissions on behalf of the claimants and the first and second respondents in this regard are wellfounded. The activities which transferred were the contracts for the computer support services for both the “Housing” and “Revs&Bens” computer systems/software. The Agreed Statement of Facts sets out the services provided by the first respondent to the second respondent and the specific activities performed by the claimants in providing these computer support services. These are the very same activities that appear in the third respondent’s Housing and Revs&Bens contracts. The third respondent is still providing the same underlying services to the second respondent that the first respondent did before it, namely the day to day support required on the Housing and Revs&Bens computer systems. “Fragmentation” of activities[76]The Department of Business Innovation & Skills Guide on TUPE, dated January 2014, recognises, at page 10, that a SPC under Reg.3(1)(b) is capable of applying where there is “fragmentation”:- “SPC: Fragmentation of a Service A service provision change will often capture situations where an existing service contract is re-tendered by the client and awarded to a new contractor. It would also potentially cover situations where just some of those activities in the original service contract are re-tendered and awarded to a new contract, or where the original service contract is split up into two or more components, each of which is assigned to a different contractor. In each of these cases it is necessary to consider whether the activities after the change are fundamentally the same as those carried out before it and then whether there was an organised grouping which had as its principle purpose the carrying out of the activities that are transferred (see below on this). However, the activities might be divided up so much that there is no service provision change. This is often called “fragmentation” of the service, and it will depend upon the circumstances as to whether a service is so fragmented that it is not a service provision change.”[77]There are no hard and fast rules, therefore, to determine when activities have become too fragmented for an SPC to have taken place. It is a question of fact and degree for the Tribunal. This was demonstrated by the EAT in Kimberley and Enterprise Management.[78]It was common ground among the parties in the present case that approximately 80% of the “relevant activities” had transferred to the third respondent. The third respondent’s solicitor relied on Enterprise Management , which decided that the services pre and post transfer were fundamentally different where the Council decided to remove the requirement for support for curriculum software which had constituted 15% of the workload. However, each case has to be determined on its own particular facts and circumstances. In Kimberley, L Ltd contracted with the Home Office to provide accommodation and support services for the Teeside area from offices in Middlesbrough and Stockton. The Home Office then retendered the contract and ended up splitting the Teeside area between two new contractors, K Ltd and A Ltd. In Stockton, K Ltd won 97% of the work, while in Middlesbrough, K Ltd won 70% of the work and A Ltd won 29%. In determining to whom the rights and liabilities transferred, and overturning the Tribunal’s decision to apportion liability, the EAT held that it was not permissible to divorce a contract from the rights and liabilities under it. The “overall principle” is to focus on the “link between the employee and the work or activities which are performed.” On this basis, and with regard to the Stockton - based claimants (where K Ltd had won 97% of the work), the EAT held that their employment had transferred to K Ltd. Regarding the Middlesbrough - based claimants (where the split was 71% to K Ltd to 29% to A Ltd), the EAT determined the case solely on the basis of the work split and accordingly held that all rights, duties and liabilities under those employee’s contracts should also pass to K Ltd.[79]This case law reinforced the view that each case has to be considered on its own facts and circumstances and whether there has been a SPC is a question of fact and degree. According to Mr Justice Langstaff in Kimberley, the overall principle is clear: “What has to be focused on is essentially the link between the employee and the work or activities to be performed”. Looking in broad terms at the present case, the claimants had been principally assigned to the contractor who had ended up with the vast majority of the work.[80]I arrived at the view, therefore, that by and large the submissions on behalf of the claimants and the first and second respondents, in support of their contention that the activities carried on by the third respondent are fundamentally or essentially the same as those which had been carried on by the first respondent, were well-founded.[81]That was the main issue in the present case as the parties were agreed that there was an “organised grouping of employees which has as its principal purpose the carrying out of the activities on behalf of the client.”[82]I arrived at the view, therefore, that there was a TUPE transfer, in the form of a SPC, from the first respondent to the third respondent. It follows, therefore, that the claims should proceed against the third respondent only and that the claims against the first and second respondents should be dismissed.