Dr Marcus Bicknell & Anor v NHS Nottingham and Nottinghamshire Integrated Commissioning Board [2026] EWCA Civ 21

[2026] EWCA Civ 21Case No CA-2024-001633
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
The Honourable Mr Justice Sheldon
[2024] EAT 103
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 21 January 2026
Before
LORD JUSTICE SINGHLORD JUSTICE BAKERLADY JUSTICE ELISABETH LAING
Between
DR MARCUS BICKNELLAppellantsTHE BRITISH MEDICAL ASSOCIATIONAppellantNHS NOTTINGHAM AND NOTTINGHAMSHIRE INTEGRATED COMMISSIONING BOARDRespondent
Nadia Motraghi KC and Professor Alan Bogg (instructed by Gateley Legal) for AppellantsBetsan Criddle KC and Adam Ross (instructed by Capsticks Solicitors LLP) for RespondentHearing Hearing date: 10 December 2025
Approved JudgmentThis judgment was handed down remotely at 11.00 am on 21 January 2026 by circulation to the parties or their representatives by e-mail and by release to the National Archives..............................

Introduction

[1]This appeal concerns the extent to which an employee is protected from dismissal (or from adverse changes to the terms on which he is employed) when the economic entity in which he is employed is transferred from one employer to another. It turns on the definition of ‘economic activity’, and, in particular, on whether the reasoning in decisions of the Court of Justice in competition cases can or should be read across to cases about employees.[2]The First Appellant (Dr Bicknell) brought three different claims of unfair dismissal and one of breach of contract in the Employment Tribunal (‘the ET’) against the predecessors to the Respondent to this appeal. The British Medical Association (‘the BMA’) also brought a claim alleging a breach of a duty to consult. The ET dismissed all the claims, apart from Dr Bicknell’s claim that he had been unfairly dismissed contrary to section 94 of the Employment Rights Act 1996 (‘the 1996 Act’). Dr Bicknell and the BMA appealed to the Employment Appeal Tribunal (‘the EAT’). The EAT (Sheldon J) dismissed their appeals but expressed some doubt about the approach of the ET and of the EAT in Nicholls v Croydon London Borough Council [2019] ICR 542 (‘Nicholls’). Bean LJ gave them permission to appeal to this court.[3]On this appeal, Dr Bicknell and the BMA were represented by Ms Motraghi KC and by Professor Bogg. The Respondent was represented by Ms Criddle KC and by Mr Ross. All counsel, apart from Mr Ross, appeared in the EAT. In the ET, the parties were represented by Ms Motraghi (as she then was) and by Mr Bayne. I thank counsel for their written and oral submissions, which helped me to understand the issues.[4]For the reasons given in this judgment, I would dismiss this appeal. There was no material error of law in the reasons of the ET. In short, the ET and the EAT were right to take the approach to ‘economic activity’ which they did take. I reject the argument that a court or tribunal can or should take a different approach to deciding whether an entity is engaged in economic activity depending on whether the court or tribunal is deciding an employment or a competition dispute. The relevant legal concept in both cases is a facet of the regulation of an internal market. It would be incoherent for different principles to apply as between competition and employment cases. The events in this case all happened before 31 December 2020. The parties have assumed, and I have assumed, that the position was governed by EU law.[5]I will start with an account of the relevant law which is as short as possible. I will then summarise the reasons of the ET, and of the EAT (to the extent that that is necessary), and the parties’ arguments. After that, I will give my reasons for dismissing the appeal. The relevant law TUPE The relevant Directive

The relevant law

[6]The Acquired Rights Directive 77/187/EC (‘the ARD’) preceded Council Directive 2001/23/EC on safeguarding the rights of employees in the event of transfers of undertakings, businesses or parts of undertakings or businesses (‘Directive 2’). Article 1(1) of Directive 2 provides:
‘a. This Directive shall apply to any transfer of an undertaking, business or part of an undertaking or business to another employer as a result of a legal transfer or merger. b. Subject to paragraph (a) and the following provisions of this Article, there is a transfer within the meaning of this Directive where there is a transfer of an economic entity which retains its identity, meaning an organised grouping of resources which has the objective of pursuing an economic activity, whether or not that activity is central or ancillary. c. This Directive shall apply to public and private undertakings engaged in economic activities whether or not they are operating for gain. An administrative reorganisation of public administrative authorities, or the transfer of administrative functions between public administrative authorities is not a transfer within the meaning of this Directive.’
[7]Directive 2 was implemented by the Transfer of Undertakings (Protection of Employment) Regulations 2006 (2006 SI No 246) (‘TUPE’). Regulations 3(1)(a), 3(4)(a) and 3(5) of TUPE give effect to article 1 of Directive 2.[8]Regulation 3 is headed ‘A relevant transfer’. It provides:
‘(1) These Regulations apply to (a) a transfer of an undertaking, business or part of an undertaking or business…to another person where there is a transfer of an economic entity which retains its identity… (2) In this regulation “economic entity” means an organised grouping of resources which has the objective of pursuing an economic activity, whether or not that objective is central or ancillary… (4) Subject to paragraph (1), these Regulations apply to – (a) public and private undertakings engaged in economic activities whether or not they are operating for gain… (5) An administrative reorganisation of public administrative functions between public administrative authorities is not a relevant transfer.’
[9]Regulation 7(1) of TUPE provides that where either before or after a relevant transfer any employee of the transferor or of the transferee is dismissed, he is to be treated for the purposes of Part 10 of the 1996 Act as unfairly dismissed if the reason or principal reason for the dismissal is the transfer.[10]Regulation 7(3)(b) provides that if the reason or principal reason for dismissal is an economic, technical or organisational reason entailing changes in the workforce of either transferor or transferee before or after a relevant transfer, regulation 7(1) does not apply, and, without prejudice to section 98(1) and 135 of the 1996 Act, the dismissal shall be regarded as having been for redundancy where section 98(2)(c) applies or ‘otherwise for a substantial reason of a kind such as to justify the dismissal of an employee hold the position which the employee held’. I will refer to such a reason as ‘an ETO reason’.[11]Regulation 13 imposes detailed duties on an employer to give information to, and to consult, the representatives of any employees who will be affected by the transfer. The transferee must give the transferor any information it needs in good time in order to enable the transferor to comply with those duties (regulation 13(4)). Regulation 15 provides remedies for breaches of the duties imposed by regulation 13. A person may make an application to the ET which may make a declaration and or order compensation in an appropriate case.

The relevant authorities

[12]There are many relevant authorities, although none decides the issue in this case. This appeal turns on two, in particular: Federación Espaňola de Empresas de Tecnología Sanitaria v Commission of the European Communities (Case T-319/99) [2003] 5 CMLR 1 (Court of First Instance); (Case C-205/03) [2006] 5 CMLR 7 (Court of Justice) (‘FENIN’) and (‘Nicholls’).

FENIN (Court of First Instance)

[13]FENIN was an organisation which represented the majority of the bodies which supplied medical goods and services to the Spanish health service (‘the SNS’). They complained to the European Commission (‘the Commission’) that the 26 organisations which controlled the SNS, including three government departments (‘the organisations’), had infringed article 82 of the EC Treaty by systematically failing to pay their invoices for, on average, 300 days, while settling other invoices faster. The Commission rejected the complaint on the ground that the organisations were not, in managing the SNS, acting as undertakings within the meaning of article 82, and the role of the SNS in providing public health services could not be dissociated from its role of buying supplies and equipment.[14]FENIN appealed to the Court of First Instance (‘the CFI’). FENIN argued, among other things, that to the extent that the hospitals which the organisations controlled provided private healthcare and bought goods and equipment for that purpose, the organisations acted as undertakings.[15]The CFI described the complaint as one of abuse of dominant position. The organisations had a dominant position in the Spanish market for medical goods and equipment which enabled them to delay paying their debts as the suppliers could not exert any commercial pressure on them.[16]The CFI considered first whether the organisations had breached articles 82 or 86 of the Treaty. The CFI’s relevant findings are in paragraphs 35-45 of its judgment. It started by recalling that, ‘according to settled case law, in Community competition law the concept of an undertaking covers any entity engaged in economic activity, regardless of its legal status and the way in which it is financed’ (paragraph 35). The ‘characteristic feature’ of economic activity was activity ‘consisting in offering goods and services on a given market, not the business of purchasing, as such’. The CFI accepted the Commission’s argument that it would be ‘incorrect, when determining the nature of that subsequent activity, to dissociate the activity of purchasing goods from the subsequent use to which they are put. The nature of the purchasing activity must therefore be determined according to whether or not the subsequent use of the purchased goods amounts to economic activity’ (paragraph 36). It followed that an organisation which buys goods, even in large amounts, not in order to offer goods and services as ‘part of an economic activity but in order to use them in a different activity, such as one of a purely social nature, does not act as an undertaking simply because it is a purchaser in a given market’ (paragraph 37). Such an entity might have a lot of economic power, and might even be a monopsony. Nevertheless, if activity for which it was buying goods was not economic activity, it was not acting as an undertaking for the purposes of competition law (paragraph 37).[17]It was agreed that the SNS, which was managed by the organisations, operated ‘according to the principle of solidarity’. It was funded by social security contributions and other public money. It provided services free of charge to its members ‘on the basis of universal cover’. It followed that in managing the SNS the organisations did not act as undertakings (paragraph 39). It followed also that in accordance with the Court’s case law, the organisations did not act as undertakings when buying goods and equipment from FENIN’s members ‘which they require in order to provide free services to SNS members’ (paragraph 40).[18]FENIN’s members had not relied on the private aspects of the SNS before the Commission, and had only done so in its reply in the CFI hearing. The Commission could not be criticised for not taking that argument into account, and the CFI could not take that argument into account in reviewing the lawfulness of the Commission’s decision (paragraphs 41-45).

The Opinion of the Advocate General (‘the AGO’)

[19]The Advocate General explained that, to be subject to Community competition law, an entity must be classified as an undertaking. The EC Treaty made ‘frequent reference to the concept’ but did not define it. It had been clarified in the case law, which ‘gives it a functional content. It has been established that an entity engaged in economic activity is an undertaking for the purposes of Arts 81-86 EC, irrespective of its legal status’. Some activities, such as air traffic control and protecting the environment, are not ‘economic in nature’. It is ‘less easy, where activities are linked to the operation of the national social security system’ to decide when they are ‘non-economic’. The Advocate General acknowledged that it was difficult to know in which cases ‘the principle of solidarity requires the application of Community competition rules to be excluded’ (AG1).[20]The Advocate General identified two particularly important issues: whether the fact that the SNS was subject to the principle of solidarity prevented it from being an undertaking, and whether it was possible to separate its purchasing activities from its provision of health services (AG2).[21]FENIN had one ground of appeal: the CFI had wrongly interpreted the concept of an undertaking. The CFI was wrong that the purchasing business was not economic activity and wrong to link the purchasing business to the service provided by the SNS. FENIN again tried to rely on the argument which the CFI had rejected on the grounds that it was not a point put by FENIN in its arguments to the Commission (AG8).[22]In AG10-AG16 the Advocate General considered the development of the case law of the Court of Justice and, in AG17-AG22, six cases about whether compulsory membership of pension, insurance or retirement schemes complied with competition law. The heading of this group of paragraphs is ‘II – Preliminary issue: the concept of an undertaking’. The classification of an entity as an undertaking for the purposes of Community law depended on the economic nature of its activity. He identified two ‘concurrent’ criteria for deciding whether activity is economic in nature or not: a comparative criterion and a criterion based on participation in a market (AG10). The Advocate General also considered national case law in AG23-25, including the judgment of the Competition Commission Appeal Tribunal (‘the CCAT’) in BetterCare v The Director General of Fair Trading (Case No. 1006/2/1/01 [2002] Competition Appeal Reports 299 (‘BetterCare’). The public authority in that case had a statutory duty to provide nursing home and residential care services for old people. It owned residential and nursing homes. Some of those were managed by private undertakings. One of those was BetterCare. The public authority was the sole purchaser of BetterCare’s services. BetterCare argued that the public authority was abusing its dominant position by forcing it to accept very low prices. The CCAT held that the decisive factor was that the public authority had commercial transactions with private undertakings and that its activities were commercial. The management of homes and provision of nursing care were a matter for the private sector and the public authority was in competition with the private sector. It was in a position to infringe competition law.[23]In deciding whether, the AGO continued, an activity carried on by the state or by a state entity is of an economic nature, ‘the court is entering dangerous territory’ in which it was necessary to balance the need to ‘protect undistorted competition on the Common Market’ with respect for the powers of member states. There was, however, no justification, if a state acts as an economic operator, ‘for relieving its actions of all control’. It was therefore ‘essential to establish a clear criterion’ to decide when competition law applies (AG26).[24]The Advocate General considered that the case should be referred back to the CFI for it to make findings about the relationship between the SNS and the provision of private healthcare and on whether ‘the solidarity which exists in the provision of free healthcare is predominant’ (AG54 and AG56).[25]If, contrary to that proposal, the Court were to uphold the decision of the CFI that the provision of free healthcare was a non-economic activity, it would be necessary to decide whether the CFI had wrongly linked the activity of purchasing to the later use of the goods which had been bought. FENIN’s argument, in summary, would have entailed that all purchases by states or by state entities were subject to competition law. It would also weaken procurement law. The cases relied on by FENIN showed that the decision of the CFI was right. Where a purchase is linked to the performance of non-economic functions it may fall outside the scope of competition law. The existence of a monopsony does ‘not pose a serious threat to competition since it does not necessarily have an effect on the downstream market’. An undertaking which has a monopsony has no interest in putting so much pressure on its suppliers that they have to leave the upstream market. The decision of the CFI did not misinterpret the cases about whether or not a purchase is an economic activity (AG65 and AG66).

The Court of Justice

[26]The Court noted that their sales of medical goods and equipment to the organisations made up more than 80% of the turnover of FENIN’s members.[27]FENIN relied on one ground of appeal which was in two parts. The second part was an argument that the CFI should have considered ‘whether purchasing activity is economic in nature and, therefore, whether it is subject to the competition rules, on the ground that the subsequent activity, namely the provision of medical treatment, is itself economic in nature’. In paragraphs 19-22 the Court considered whether that second part was admissible. It held that it was not.[28]FENIN’s first argument was that the CFI should have considered whether purchasing on its own was an economic activity which could be dissociated from the services which were provided subsequently (by the SNS), and that, therefore, the organisations were subject to competition rules (paragraph 17). FENIN argued that a definition of economic activity that necessarily consists of the offer of goods and services on a given market, and which excludes all purchasing activity, was too narrow. It would enable many bodies to avoid competition law, even though competition was affected by their activities (paragraphs 17 and 23).[29]The Court held, in paragraph 25, that the CFI had been right to decide that in Community competition law, the definition of an undertaking ‘covers any entity engaged in economic activity’, regardless of its legal status and of the way it is funded. The CFI had also been right to hold that the characteristic feature of economic activity ‘is the activity consisting in offering goods and services on a given market’. The CFI had also been right to deduce that ‘there is no need to dissociate the activity of purchasing goods from the subsequent use to which they are put’ in order to decide about the nature of the purchasing, and that ‘the nature of the purchasing activity must be determined according to whether or not the subsequent use of the purchased good amounts to an economic activity’ (paragraph 26). The Court therefore dismissed that ground of appeal (paragraph 28).

Nicholls

[30]The claimants in Nicholls were employed by a primary health care trust as members of its public health team (‘the team’) until their employment was transferred to a local authority under a staff transfer scheme made by the Secretary of State under section 300 of the Health and Social Care Act 2012. The local authority then tried to vary their terms and conditions of employment. They resisted and either resigned or were dismissed. They then brought unfair dismissal claims in the ET under TUPE. The local authority accepted that there had been a transfer of an entity which retained its identity (the team) but argued that it was a transfer of ‘administrative functions between public authorities’.[31]The ET held that the team’s activities were the exercise of public health functions in the interests of the community. It did not bid for contracts but commissioned services and other activities, which were all services offered by the private sector operating in the same market. The ET held that the public health function was governmental and that was not undermined by the involvement of private providers through the commissioning process, so that TUPE did not apply to the transfer (regulation 3(5)).[32]The claimants appealed.[33]Lavender J described the legal framework in paragraphs 6-17. He considered the cases about undertakings, including FENIN, in paragraphs 20-43. The parties in Nicholls agreed that the competition cases about what amounts to an undertaking were relevant because competition law uses the same word with the same definition (paragraph 20(3)). He described some examples from the cases in paragraph 23. He summarised BetterCare in paragraphs 29-36. He observed that one of the CCAT’s reasons for holding that the public authority was carrying on economic activity was that it charged residents what they were able to pay for its services (paragraph 34). He said that other parts of the reasoning of the CCAT were inconsistent with FENIN (paragraph 35).[34]He considered FENIN in paragraphs 37-43, quoting paragraphs 25-27 of the judgment of the Court of Justice in paragraph 41. In paragraph 42, he said that ‘It follows that(1) the purchasing or commissioning of goods and services cannot in itself constitute an economic activity; but(2) a body which supplies goods and services on a market is carrying on an economic activity, both in supplying those goods and services and in purchasing goods and services for the purpose of that supply’. He then quoted paragraph AG26 (see paragraph 23, above).[35]In paragraphs 44-68, he described some of the ‘threads from the authorities’. I refer the interested reader to those paragraphs for the detail: I will do no more than to summarise the main points. In paragraphs 45-46, under the heading ‘The two mutually exclusive alternatives’, he said that, ‘In a case such as the present’, an ET should consider the particular activities of the entity which is transferred, applying a ‘functional approach’. There were two mutually exclusive alternatives: economic activity and the exercise of public powers (paragraph 45). It was a fundamental distinction.[36]The definition of economic activity was settled: it was ‘Any activity consisting in offering goods and services on a given market’ (paragraph 47). If there is a market for the goods and services, their provision without charge will still be economic activity (paragraph 49). There can be such a market if the goods are provided to the state or to a state-authorised entity or are provided by one state body to another (paragraph 50). An entity meeting that definition would be an undertaking even if it is a public law entity, is publicly funded, acts in the public interest or discharges statutory functions (paragraph 51).[37]In paragraphs 52-63 he considered cases about the exercise of public authority. The cases established that the exercise of public authority is not economic activity. It can be difficult to decide whether that test is met in a particular case (paragraph 53). Not everything which a public body does will amount to the exercise of public authority. Lavender J considered that there was no ‘single definitive test’. In paragraph 55 he listed ten questions which it was ‘relevant for a court or tribunal to ask’. He rejected the claimants’ argument that the relevant factors could be reduced to a ‘three-pronged test’ (paragraph 57).[38]He considered ‘mixed cases’ in paragraphs 64-68. He noted a tension between regulation 3(2) of TUPE and the decision of the Court of Justice in Henke v Gemeinde Schierke (Case C-298/94) [1997] ICR 746 (‘Henke’). He resolved that tension by accepting a suggestion by Mr Cavanagh QC that the opening words of article 1(1)(b) of Directive 2 were the solution (see paragraph 6, above). Regulation 3(2) was intended to give effect to article 1(1)(b), and should be read so as to be consistent with it. That included reading regulation 3(2) as being subject to regulation 3(5), since regulation 3(5) gives effect to article 1(1)(c) of Directive 2, to which article 1(1)(b) is subject. In deciding whether regulation 3(5) applied, it was appropriate to take into account the judgment in Henke, which regulation 3(5) is intended to implement (paragraph 67). He therefore concluded that a transferred entity which carried on activities in the exercise of public authority would not be considered an economic entity ‘merely because it carried on some ancillary activities of an economic nature’ (paragraph 68).[39]Lavender J held that the ET’s finding of fact that all or most of the team’s work ‘can be and in fact is offered by non-state actors operating in the same market’ was a ‘strong indication’ that the team was carrying out economic activity. The ET should have, but had not, explained why that finding did not lead to the conclusion that that was what the team was doing. The ET had therefore failed to give adequate reasons for its conclusion or had erred in law (paragraph 112). He therefore allowed the appeal on the first preliminary issue (paragraph 113). He also allowed the appeal on the second such issue. He remitted the case to a differently constituted ET on the first issue. No remittal was necessary on the second.

The judgment of the ET in the present case

[40]The ET made detailed findings of fact in paragraphs 26-85 of its judgment, to which I refer the interested reader (the decision may be read on the GOV.UK website). I will only give a brief summary of those findings of fact. The ET began with a history of structural changes in the National Health Service (‘the NHS’). In 1999 there were 481 primary care groups (‘PCGs’). They were sub-committees of the various District Health Authorities. They then became primary care trusts (‘PCTs’). There were 17 PCTs in April 2000, 23 more in October 2000, and 124 by April 2001. The intention was that all PCGs were to become PCTs by 2004.[41]PCTs gave money to General Practitioners (‘GPs’). PCTs paid for prescriptions, and commissioned hospital and mental health services from NHS provider trusts and from the private sector. They were managed by executive directors headed by a chief executive. All members of PCT boards, including the non-executive directors, were appointed after open advertisement. The boards also elected practitioner representatives.[42]In 2005, the Government announced that the number of Strategic Health Authorities and PCTs was to be reduced. By October 2006, the number of PCTs had gone down to 152 from 303. The average population served by each was about 300,000 people. The areas of 70% of the PCTs were coterminous with the areas of local authorities. There were further changes in 2013. PCTs were abolished and were replaced by new groups led by GPs, clinical commissioning groups (‘CCGs’). Most PCT staff went to CCGs. Public health functions were transferred to local authorities. Some support staff transferred to commissioning support units (‘CSUs’).[43]It then became clear that many CCGs were too small, so they grouped together informally (paragraph 34). There were seven in Nottinghamshire (which the ET listed in paragraph 35). Three started working together in 2017 (paragraph 36). Two others clubbed together in 2018 (paragraph 37). In 2019, six out of seven started working together under a common committee.[44]There was a new plan in 2019 to merge the six CCGs into one. They merged on 1 April 2020 to form North Nottingham CCG (‘NN CCG’). That body was dissolved on 1 April 2022 and replaced by the Respondent.[45]In paragraph 41 the ET referred to a Government policy statement which provided that if there was a reorganisation and functions were transferred from one public sector organisation to another, either TUPE would apply or, if not, the parties should behave as though it did. The ET noted that the Secretary of State can make transfer orders.[46]Dr Bicknell’s continuous employment with NN CCG began in 2013. He had a contract of employment (‘the contract of employment’) as a GP clinical lead for three sessions a week. The ET quoted clause 17 of the contract of employment in paragraph 43. Clause 17 referred to NHS terms and conditions. Only two CCGs employed clinical leads on contracts of employment. The other CCGs engaged them under contracts for services. Dr Bicknell had a second contract, for services, with NN CCG. Nothing turned on that.[47]The plan was discussed at a ‘confidential’ meeting on 17 October 2018: Dr Bicknell was there (paragraph 47). In paragraphs 48-54 the ET made further findings of fact about the evolution of the plans and various meetings. In April 2019, the governing bodies of the six CCGs formally agreed, in principle, that they would merge. The GPs’ Practices were consulted in May-June 2019. The GPs voted in favour of the plan (paragraph 52). The relevant strategy document was sent to NHS England on 28 June 2019. On 1 July 2019 a ‘Committee in Common’ was created.[48]By July 2019, staff in the six CCGs were being matched to roles in the proposed new structure. There was then, in substance, a redundancy process: but that word was not used (paragraph 54).[49]In October 2019 there was a meeting of clinical chairs. This was the first time a ‘clinical design authority’ (‘CDA’) was mentioned. The discussion was at a high level. The CDA was to be a ‘provider function’. The notes did not say whether those working for the CDA would be self-employed or employees. The ET thought that clinical leads gave clinical advice on commissioning decisions which was a ‘commissioner not a provider function’ (paragraph 59).[50]On 16 October 2019 NHS England approved merger of the six CCGs in principle, on five specific conditions. All six CCGs were to be dissolved. A new body would be created. The ET listed the five conditions in paragraph 60. The staff were told on 30 October 2019 that the plan had been approved.[51]The ET described the process by which it emerged that Dr Bicknell was to be made redundant. In paragraph 67, the ET expressed its surprise at the view in a paper dated 26 November 2019 sponsored by Ms Sarah Carter that ‘no risks have been identified as a redundancy consultation process has been undertaken in accordance with employment law’. The reason for that surprise was that she had also sponsored a paper which was put before a committee on 13 November 2019 which said that six GPs were at risk of redundancy. It seemed as a though a decision to make them redundant had already been made and that any discussion was pointless (paragraph 67). Ms Carter gave evidence to the ET. At the relevant time, she was ‘Executive Director – Transitional Operations, HR and Organisational Development’ (paragraph 8).[52]Dr Bicknell was given written notice of dismissal in a meeting on 27 November 2019. That contained a calculation of his redundancy payment (which turned out to be wrong). That mistake was corrected 3 December 2019.[53]The BMA was formally consulted on 23 January 2020. The BMA was sent a consultation document. The covering letter said that the transfer would be done in accordance with TUPE and email which attached both was headed ‘… TUPE transfer…’. The text of the email also referred to a ‘proposed TUPE transfer’ on 1 April 2020 (paragraph 72). Another document also referred to a ‘TUPE transfer’ (paragraph 74).[54]Dr Bicknell was sent a letter dated 28 January 2020 which told him that his employment would end on 27 February 2020 (paragraph 75). He applied for a self-employed post as a GP Lead. He was interviewed but was not appointed (paragraphs 76, 80 and 81). He presented his claim to the ET on 21 July 2020 (paragraph 84).[55]Paragraphs 88-185 of the ET’s judgment are headed ‘Discussion and Conclusions’. The first question which the ET considered (paragraphs 86-117) was whether there had been a transfer to which TUPE applied. In paragraph 86 the ET wryly observed, ‘We note that in essence both parties drew our attention to the same case law and asked us to come to entirely different conclusions based on the same facts and the same cases’.[56]In paragraph 87 it said, with admirable concision, ‘For there to be a transfer of an undertaking there has to have been the transfer of an economic entity from one person to another. An economic entity is an undertaking which carries on economic activity’. Whether or not this self-direction was correct is a key issue in this appeal.[57]In paragraph 88, the ET gave three examples from decisions of the Court of Justice and five from domestic cases (four EAT decisions and one decision of the High Court) in which similar issues had been decided. The ET said that it would follow the decision of the EAT in Nicholls and take a ‘functional approach’ to identifying ‘the nature of the activities of the transferor’. It must decide whether those activities are ‘economic activity’ or ‘public administrative functions’ as ‘it is only where the activities are an “economic activity” that they will be within the scope of “relevant transfer” under TUPE. If they are “public administrative functions”, the transfer will fall within the exclusion in Regulation 3(5))’ (paragraph 90).[58]In paragraph 91, the ET said that the starting point was what the CCGs were doing before the ‘transfer’. Did it amount to ‘economic activity’? The ET therefore had to consider what amounts to economic activity. One definition was ‘any activity consisting in offering goods and services on a given market’ (paragraph 92). One question was whether the activity was the provision of goods and services or just their acquisition, another was whether there was a market for the goods or services (paragraph 93). If there was a market, then the provision of goods and services in that market was an economic activity (paragraph 94). A relevant factor was whether the activity could be done by a private entity for profit (paragraph 95). There could be a ‘market’ even if goods were provided by the state or by an entity authorised by the state or the goods and services were provided by one state body to another. The entity ‘providing the economic activity can be a public law entity, publicly funded, acting in the public interest and acting pursuant to statutory functions’ (paragraph 96).[59]Paragraphs 97-103 are headed ‘Functions of NC CCG’. CCGs were groups of local GP practices whose governing bodies included GPs, clinicians, patient representatives, general managers and sometimes practice managers and local authority representatives (paragraph 97). The aim of the system before 2022 was to ‘put GPs at the forefront of the commissioning process’. CCGs had the statutory function of commissioning most NHS services. They had to assess local needs, decide priorities and plans and then buy services for people from providers such as hospitals, clinics etc. They had to respond to changing circumstances. They were responsible for the health of local people and ‘measured by how much they improve[d] outcomes’ (paragraph 98).[60]The ET added, in paragraph 99, ‘In short commissioning is essentially the process by which health and care services are planned, purchased and monitored. So in this context, “commission” means “buy”. It does not mean “provide”’. The ET described the legal framework in paragraph 100 by reference to sections 1 and 2 of the National Health Service Act 2006 (‘the 2006 Act’). The CCG’s functions included, by section 1(2), ‘arranging for the provision of services for the purposes of the health service in England in accordance with this Act’. Section 2 was headed ‘General power’. It was a power to do those things which were conducive and incidental to the discharge of any function conferred by the 2006 Act. Part 2 of the 2006 Act listed the general duties of CCGs. Whatever a CCG did which was not commissioning services (or monitoring them) was ‘subordinate to its overarching duty to commission healthcare services’ (paragraph 101).[61]In paragraph 102 the ET described the functions of CSUs. CCGs could buy services from CSUs or provide those services themselves. The services provided by CSUs included help and support with such functions as finance, HR, data management, and contracting. The ET noted the evidence of Dr Bicknell that NN CCG provided training for its staff, ‘signposted patients to relevant services’ and did other ‘peripheral’ things. The ET did not accept his evidence about pharmacy services which, the ET understood, were commissioned by the NHS Board and not by CCGs. It accepted evidence that the CCG was not registered to provide medical services. In the ET’s judgment, it was ‘extremely unlikely that it did so, and we find that it did not’ (paragraph 103).[62]The ET then considered, between paragraphs 104 and 117, whether NC CCG carried out economic activity. The ET referred to Nicholls. It noted that, in paragraph 42 of Nicholls, the EAT had held that buying or commissioning goods or services ‘cannot in itself constitute an economic activity; but …a body which supplies goods or services on a market is carrying on an economic activity, both in supplying those goods or services and in purchasing goods or services for the purposes of that supply’ (paragraph 104).[63]The ET found ‘the principal work of NC CCG was to commission healthcare services from providers to be delivered by those providers to the public’. That was ‘squarely within’ the first limb of paragraph 42 of Nicholls. The ET had to follow Nicholls. ‘CCGs do not and NC CCG did not supply goods or services on a market. Regulation 3(5) [of TUPE] applie[d] and there was no relevant transfer when NN CCG was dissolved, and its work transferred to’ the new body (paragraph 105).[64]The ET then considered an argument that the purchase of services to be provided by a third party can amount to economic activity either in and of itself, as Ms Motraghi contended, or because it fell within the second limb of Nicholls (paragraph 106). Those arguments were based on the decision of the Court of Justice in FENIN. The ET accepted, on the basis of the decisions of the Court of Justice to which it referred, that activities which involve an offer of goods and services on a given market are economic in nature even if they are not carried out with a view to a profit, they are entrusted to a public body, or are done in the public interest or for the public good (paragraph 109).[65]But NN CCG did not provide goods or services. Its ‘central function’ was to commission others ‘to provide principally services’ (paragraph 109). The ET understood that the argument was based on the AGO in that case. FENIN was not an employment case, but a competition case. The relevant definitions were, however, the same (paragraph 110).[66]In paragraph 111 the ET then quoted a paragraph of what it described as the AGO. In fact, as Ms Criddle accepted in her oral submissions to this court, as she had in the EAT (see paragraph 35 of the EAT’s judgment), the relevant passage was from the judgment of the Court of Justice, not from the AGO. The passage quoted consists of most of paragraph 26 of the judgment of the Court (see paragraph 29, above), with an extra sentence. Ms Motraghi submitted that this passage showed that the ET did not separate the commissioning of the services from their delivery by the providers, so that, if the provision of the services was economic activity, so was their commissioning (or purchase).[67]The ET discounted this passage on the erroneous ground that it was not adopted by the Court of Justice. The ET rejected Ms Motraghi’s argument in paragraph 112. The ET therefore considered that it was not bound by that passage. It was bound, instead, by Nicholls (paragraph 113).[68]The ET did not consider it necessary to consider the ten points listed by Lavender J in Nicholls, because this was a clear case. The ‘dissociative approach’ was ‘the default position’ (paragraph 114).[69]In paragraph 116, the ET criticised parts of the Respondent’s evidence as ‘less than convincing’ and, indeed, ‘literally incredible’. The ET was not at all persuaded that the Respondent had, throughout, assumed that TUPE did not apply. The Respondent’s witnesses had either been misleading the Respondent’s employees, or had not been honest to the ET. The ET ‘tended towards the latter explanation’. The ET acknowledged in paragraph 117 that just because the Respondent had believed there was a TUPE transfer did not meant that there was. The ET had to apply the law to the facts. It had found that the ‘purported transferor principally commissioned services and anything else it did was ancillary to, and in support of that central commissioning function’. Regulation 3(5) therefore applied. NN CCG was ‘not carrying out economic activities and it was not an economic entity and therefore there was no transfer of an undertaking when it was dissolved and its functions taken on by NN CCG’.[70]The ET considered unfair dismissal in paragraphs 118-148. It considered whether dismissal would have been automatically unfair under regulation 7(1) of (2) of TUPE. The ET applied a ‘but-for’ test (paragraph 123). No witness would own up to having made the decision to dismiss, and no witness would say whose decision it had been (paragraph 141).[71]The ET held that the reason for Dr Bicknell’s dismissal was the transfer. If TUPE had applied, his dismissal would have been automatically unfair (paragraph 148). The ET then considered whether there was an ETO reason for his dismissal (under regulation 7(2)). The onus was on the employer. The ET held that there was no ETO reason (paragraph 156). In paragraph 157 the ET considered ordinary unfair dismissal. The Respondent had in effect conceded that Dr Bicknell’s dismissal had been procedurally unfair (paragraph 158). The ET held that it was procedurally unfair. Without the reorganisation he would not have been made redundant (paragraphs 160, 162, and 163). The ET dismissed his claim for breach of contract.[72]The ET considered the BMA’s consultation claim in paragraphs 171-183. It held that that claim would have succeeded if there had been a transfer to which TUPE applied.

The EAT

[73]Dr Bicknell and the BMA appealed to the EAT on three grounds. 1. The ET misunderstood the test for economic activity. 2. The ET also misunderstood the test for a transfer of public administrative functions. 3. The ET failed to identify all the relevant activities of the Respondent or to give adequate reasons why the Respondent was not providing services.[74]The EAT (Sheldon J) summarised the judgment of the ET (paragraphs 4-14) and the parties’ submissions (paragraphs 16-38). It gave its reasons for dismissing the appeal in paragraphs 40-70.[75]The EAT said that the real complaint under ground 1 was that the ET had misunderstood paragraph 42 of Nicholls. Lavender J had not decided that the commissioner also has to supply the goods and services in the market. Sheldon J described this submission as ‘plainly wrong’ (paragraph 40). Lavender J had clearly decided that ‘for commissioning to be an economic activity, the commissioner had also to supply goods and services on the market’. That was supported by other passages in the judgment in which he had rejected the argument that commissioning can be an economic activity if the commissioner does not also supply those goods or services to the market (paragraph 40). Sheldon J developed this point in paragraphs 41-43, in reliance on paragraphs 79(3), 87, 88 and 104 of Nicholls. Those statements that commissioning on its own is not economic activity and would only be economic activity if the commissioner was also providing goods or services in a market were an essential part of the reasoning in Nicholls (paragraph 44).[76]Sheldon J concluded that the EAT could only allow the appeal on ground 1 by departing from the decision of the EAT in Nicholls. He referred to paragraph 75 of British Gas Trading v Lock [2016] EWCA Civ 983; [2017] ICR 1. He asked whether the reasoning in Nicholls was ‘manifestly wrong’. He referred to Directive 2 (the source of TUPE) and quoted article 1. He explained article 1 in paragraph 48. In paragraph 49, he quoted regulation 3 of TUPE. He pointed out that assimilated case law is binding because Dr Bicknell was dismissed before the expiry of the implementation period (paragraph 50).[77]The most succinct description of economic activity in the decisions of the Court of Justice is that it includes ‘any activity consisting in offering goods and services on a given market’ (paragraph 51). There was no case about commissioning in the employment context. The question had been considered in a competition law context in FENIN and in BetterCare (in the CCAT). Sheldon J quoted Lavender J’s analysis of those two cases in paragraphs 29-27 of Nicholls. He also quoted paragraphs 43 and 47 of Nicholls. Sheldon J held that the first limb of paragraph 42 of Nicholls was a ‘correct understanding’ of paragraphs 36 and 37 of the decision of the Court of First Instance (‘the CFI’) in FENIN. That passage was approved by the Court of Justice in paragraphs 26-27 of its judgment. He also held that the second limb of paragraph 42 was a ‘fair reading’ of the decisions of those courts (paragraphs 58-59).[78]Lavender J had deduced a principle from FENIN that the commissioner of goods and services also had to provide them. The courts in FENIN had not said so expressly. That was not the question they were considering, ‘so it is arguable that this deduction was wrong’. It was not, however, obviously or manifestly wrong. That deduction fitted with the general description of economic activity in the cases (paragraph 60).[79]In paragraph 61, Sheldon J said that he had ‘some doubt’ whether the principles ‘established (or deduced from) FENIN, a competition law case, should have been applied to the employment arena’. He recorded the argument that in competition law the concept is a tool to restrain distortion of the market, whereas the purpose of Directive 2 is to protect employment rights. He saw ‘much force in that argument’. The concerns described in paragraph 66 of the AGO in FENIN do not necessarily apply in the context of employment. It was arguable that Ms Motraghi’s ‘purposive’ interpretation ‘calls for a different analysis in the employment context’ (paragraph 62). He could not say, however, that Lavender J’s interpretation of FENIN was manifestly wrong. The Court of Justice had applied the same definition of ‘economic activity’ in a number of cases concerning transfers of undertakings (paragraph 63).[80]He agreed that the ET’s ‘understanding of FENIN was muddled’. That muddle had not, however, affected the ET’s conclusion. The ET was clear that it was following the decision in Nicholls (paragraph 65).[81]The ET had not erred by not considering regulation 3(5) of TUPE. If commissioning was not an economic activity, the logic of Nicholls was that there could not be a relevant transfer for the purposes of TUPE (paragraphs 67 and 68). Sheldon J rejected the Respondent’s argument that the ET had considered this issue (paragraph 68). The EAT dismissed ground 2.[82]The EAT also dismissed ground 3. The EAT held that the ET had ‘made sufficient findings’ (paragraphs 69-70).

The grounds of appeal

[83]There are four grounds of appeal in this court. 1. ‘Economic activity’ includes commissioning activities which are connected with a market. Dr Bicknell relies on two alternative arguments: FENIN is right, but has been misunderstood; or FENIN is wrong. 2. ‘Economic activity’ in TUPE must, in accordance with domestic canons of statutory interpretation, have a wider meaning than it would have in EU law, which would include NN CCG’s commissioning activities. 3. The ET erred in law in failing to consider whether regulation 3(5) of TUPE applied. 4. The ET erred in law in holding that NN CCG’s ancillary functions were irrelevant to the question whether it was an economic entity. The submissions Dr Bicknell and the BMA

The submissions

[84]In support of ground 1, Ms Motraghi argued that Nicholls was wrongly decided. ‘Economic activity’ includes commissioning which is connected with a market. FENIN applies where what is commissioned is supplied on a market. The eventual provision of the services on a market by the third party, or on the instructions of the commissioner, means that the commissioning is itself economic activity. If that is wrong, FENIN does not, as a matter of EU law, apply to employment cases because it is a competition case.[85]Ms Motraghi submitted that the reasoning of the CFI depended on the fact that the basis of the SNS was ‘the principle of solidarity’. Neither the CFI nor the Court of Justice addressed FENIN’s argument that the healthcare system in Spain involved a conventional market as well as the solidarity principle. FENIN decides that the nature of purchasing depends on whether or not the use of the relevant goods or services amounts, itself, to economic activity. The relevant inquiry was whether or not the medical supplies were being used in a market-based system, or a system based on solidarity.[86]The Respondent in this case did not argue that the system in England is based on solidarity. There is a range of providers in that system. Patients can choose which providers to use. The services commissioned by NN CCG were commissioned to be offered in a market for healthcare services. Nicholls was wrong to suggest that unless the body which commissions the services also itself provides them on a market, it is not an economic entity.[87]The alternative case on ground 1 is that the policy issues in an employment context and in a competition case are different. The second context is critical to an understanding of the AGO. It is reflected in the reasoning of the CCAT in BetterCare.[88]The approach to statutory construction advanced under ground 2 is closely related to the alternative argument under ground 1. TUPE’s purpose is to protect employees. Directive 2 is a floor, not a ceiling. ‘Economic activity’ should be interpreted so as to support that purpose. Ms Motraghi invoked paragraph 71 of the judgment of Lord Leggatt in Uber v Aslam [2021] UKSC 5; [2021] ICR 1657. TUPE ‘gold-plated’ Directive 2 in various ways. In the light of FENIN the concept of economic activity, which is a gateway to protection, is not ‘entirely clear’. Any ambiguity must be resolved in favour of the employee.[89]Ms Motraghi argued on ground 3 that the ET erred in law in not considering whether regulation 3(5) of TUPE applied because it wrongly considered that there was no relevant economic activity. The only available conclusion was that regulation 3(5) could not apply. Ms Motraghi submitted the ET was bound by the reasoning in paragraphs 45 and 55 of Nicholls (see paragraphs 35 and 37, above).[90]The argument on ground 4 was short. The ET held that NN CCG’s core functions were not economic activity. It should then have considered whether its ancillary functions amounted to economic activity. The effect of regulation 3(2) of TUPE is that if an objective of an entity is to engage in economic activity, it will be an economic entity even if that activity is ancillary to its main functions. The ET erred in law in failing to consider NN CCG’s ancillary functions.

The Respondent

[91]The Respondent pointed out that the argument of Dr Bicknell and of the BMA in this court had changed from the argument they put forward in the ET and in their written arguments in the EAT. Below, they had relied on the decision in FENIN as showing that the commissioning of services should be aggregated with the later delivery of those services by third party providers, and that that composite amounted to economic activity.[92]The Respondent’s case was that it is well settled that buying goods and services does not, of itself, amount to economic activity. In FENIN the organisations acting for the SNS both bought and provided the relevant goods and services. FENIN decides that whether or not those purchases amounted to economic activity depended on the use to which those goods and services were put by the organisations which had bought them. As that use was for the purposes of solidarity, and did not therefore amount to economic activity, the purchases were not economic activity either. FENIN does not support the proposition that NN CCG’s activities should be aggregated with those of the bodies which provided the services commissioned by NN CCG. There is no legal basis for the idea that commissioning which is ‘connected’ to a market itself amounts to economic activity. It is contrary to the language of TUPE and of Directive 2.[93]The CFI in FENIN was clear, in paragraphs 36 and 37, that it is the offer of goods and services on a market which characterises economic activity, not purchasing ‘as such’. If an entity buys goods and services, not as part of an economic activity, but for social purposes, it does not act as an undertaking just because it buys goods and services. The Court did not decide, because that issue was not before it, that the nature of the purchasing should be decided by reference to the downstream use of the goods and services by entities other than the organisations which bought them.[94]The Court of Justice has taken the same approach to economic activity in competition cases and in employment cases. The purpose of that approach in each case is to regulate the common market. EU law distinguishes between economic activity and the exercise of public powers. The second is a matter for member states.[95]The question whether there has been a relevant transfer must be answered solely by reference to Directive 2. The definition of a ‘relevant transfer’ in TUPE does not go further than Directive 2. Section 38 of the Employment Relations Act 1999 (‘1999 Act’) give the Secretary of State power to make provisions to implement Directive 2 which go further than Directive 2. The circumstances in which the Secretary of State can make such provision include circumstances in which there is no transfer or there is no transfer to which the main part of TUPE applies. The Respondent submitted that this power ‘has no bearing on’ regulation 3(1)(a). TUPE and Directive 2 define ‘relevant transfer’ in the same way. The power conferred by section 38 was used to introduce a new concept, ‘the service provision change’.[96]The success of ground 1 or 2 is the premise of ground 3. Ground 3 therefore adds nothing to grounds 1 and 2. The ET was not required to find both that there was no economic activity for the purposes of regulation 3(1)(a) and that regulation 3(5) applied. Either finding would have been enough on its own.[97]The ET’s findings of fact in paragraphs 97-105 (see paragraphs 59-63, above), read fairly, were that NN CCG’s core function was commissioning healthcare service and that any other ancillary activities were not the economic activities because they did not amount to an offer of goods and services in a market. The ET made specific findings about pharmacy services, rejecting Dr Bicknell’s evidence. Discussion Ground 1

Discussion

[98]The term ‘undertaking’ was used in articles 81-86 of the EC Treaty, which dealt with competition. As the Advocate General pointed out in AGO1 in FENIN,that term was not defined in the EC Treaty. Its meaning was clarified in case law. It has been the subject of many decisions of the Court of Justice, some of which Lavender J referred to in Nicholls, and some of which the parties referred in their written and oral arguments. According to that case law, an entity was an undertaking for the purposes of the competition provisions of the EC Treaty if it was engaged in economic activity. One criterion for deciding that question was whether the entity participates in a market. Against that background it is significant that the same term, ‘undertaking’ was the subject both of the provisions of the ARD and of Directive 2, which replaced the ARD. The competition provisions in the Treaties and the ARD Directive 2 were and are all intended to regulate different aspects of the functioning of the single market. It is, to say the least, likely, that when the European legislator used the term ‘undertaking’ in the ARD and in Directive 2, it was intended to have the same meaning as in the Treaty provisions governing competition.[99]That intuition is confirmed by decisions and AGOs which apply the approach in the competition cases to the question whether there has been a transfer of an undertaking. Ms Criddle referred to the decision of the Court of Justice in Collino v Telecom Italia SpA (C-343/98) [2002] ICR 38, and to statements by Advocates General in two other cases (Mayeur v Association Promotion de l'Information Messine (APIM) (C-175/99 [2002] ICR 1316 AG58 and Scattolon v Ministero dell'Istruzione, dell'Universita e della Ricerca (C-108/10 [2012] ICR 740 AG51). In the second case, as she pointed out, the Court of Justice relied on competition cases to decide that there had been a relevant transfer. I therefore accept, in principle, her submission that it would be incoherent for any court to take a different approach to identifying an undertaking according to whether the case is a competition case or a case about the transfer of an undertaking. I also accept her submission that that, in practice, is the approach which the Court of Justice has taken. In that situation, a general appeal to the protective purpose of Directive 2 does not help. It does not explain how, or by reference to what criteria, something which is not economic activity, as that term has been explained in the case law, can somehow become economic activity if the rights of employees are affected.[100]I can detect no hint in FENIN that the Court of Justice intended to, or did, take a different approach to the identification of an undertaking from the conventional approach. The Court of Justice decided that the organisations were not engaged in economic activity when they bought goods and services for the purposes of SNS, which, the Court of Justice held, was not engaged in economic activity but in activities based on solidarity. In FENIN the organisations were both buying the goods and services and providing them. The Court of Justice considered that the purpose for which the goods and services were provided to patients sheds light on whether the purchase of those goods and services was economic activity. It did not decide, expressly or by inference, either that the purchase of goods and services by itself amounts to economic activity, or that the purchase of goods and services by one body (or group) can amount to economic activity if those goods and services are used by another entity for an economic purpose, still less if they are used ‘in connection with a market’.[101]It is not open to this court to depart from FENIN (see paragraph 76, above). Even if it were, I would reject the submission that FENIN is wrong in principle. The Court of Justice applied a settled approach to deciding whether or not the purchasing activities of the organisations amounted to economic activity and were therefore capable of being an abuse of a dominant position. I also reject the submission that FENIN was right, but has been wrongly interpreted. The ET and the EAT’s understanding of the reasoning of the Court of Justice was correct. I accept, as Ms Criddle did in the EAT and in this court, that, in paragraph 111, the ET wrongly attributed the passage on which Ms Motraghi relied to the Advocate General when it was, in fact, part of the reasoning of the Court of Justice. I consider that that mistake did not affect the ET’s conclusion, as the ET saw itself as bound by, and applied, Nicholls, and, on this point, Nicholls reflects the reasoning of the Court of Justice.

Ground 2

[102]It is true that section 38 of the 1999 Act enabled the Secretary of State to go further than Directive 2. But there is no hint in the relevant provisions of TUPE that the Secretary of State took that opportunity by relaxing the meaning of ‘economic activity’ in some hidden way. The language of the relevant provisions accurately reflects the words of Directive 2, and must therefore be interpreted in accordance with the relevant case law of the Court of Justice. I therefore reject the submission that TUPE secretly goes further than Directive 2. I repeat the last sentence of paragraph 99, with the necessary change.

Ground 3

[103]If there is no economic activity, TUPE does not apply. If there is an exercise of public authority, TUPE does not apply either. Ground 3 may be based, in part, on a misreading of paragraphs 44-68 of Nicholls. Lavender J’s express premise is that economic activity and the exercise of public authority are two mutually exclusive categories. It follows that if an ET makes findings of fact from which it is confident that the body in question is not engaged in economic activity, that is the end of its enquiry: TUPE does not apply. An enquiry whether the body is exercising public functions is unnecessary, because, as a matter of logic, and without further inquiry, it is clear from the conclusion that there is no economic activity that the body must be exercising public functions. Lavender J did not say that an ET must apply both tests in every case, or that, in a case in which it is clear that there is no economic activity, the ET must also ask whether the body is exercising public authority by reference to the ten questions he listed in paragraph 55. The ET was entitled, as it did, to decline to ask the ten questions (paragraph 114, see paragraph 68, above). I would dismiss ground 3.[104]As a postscript to ground 3, I emphasise the first phrase of the first sentence of paragraph 45 (see paragraph 35, above). Lavender J did not decide that there are two mutually exclusive categories in every potential TUPE case. He was careful to confine that statement to ‘a case like the present’: in other words, a case in which the activity in question is evidently on the boundary between economic activity and the exercise of public authority. As I suggested to Ms Criddle in argument, there might well be cases in which there is no economic activity and no exercise of a public authority, such as non-economic activities of a charity. I do not consider that Lavender J intended to indicate otherwise.[105]I can deal with ground 4 briefly. The ET did consider the extent, if any, to which NN CCG engaged in ancillary activities which might be economic. It made findings of fact which it was entitled to make on the evidence, and, in particular, rejected Dr Bicknell’s evidence about pharmacy services (paragraphs 101 and 102, see paragraphs 60 and 61, above). I would dismiss ground 4.

Conclusion

[106]For those reasons I would dismiss this appeal.[107]I agree.[108]I also agree.