UK: Employees on long-term sick leave are not 'assigned' for TUPE transfer if absence is permanent

Case law has established that temporary absence from work, for example on sick leave or family-related leave, does not prevent an individual being 'assigned' to a grouping of employees and therefore transferring with that grouping where there is a service provision change under TUPE.  The EAT has now confirmed that the position is different where the absence is permanent, ie there is no expectation of a return to work; in that event an employee will no longer be 'assigned' to the grouping.

In this case an employee was absent on long-term sickness from 2006, receiving first PHI payments and then discretionary sick pay until 2010, when it was decided that he was permanently incapable of returning to work. He remained on the books (without pay) for contractual and administrative convenience. The EAT ruled that by the time of a transfer in 2012, he was no longer assigned to the relevant organised grouping, as assignment requires something more than mere administrative or historical connection. Permanent inability to work should be distinguished from temporary inability.

Transferees will welcome the ruling that permanently incapacitated employees do not transfer under TUPE, but employers will still need to carefully assess employees on long-term sick leave to determine whether there is any expectation of a return to work. (BT Managed Services v Edwards)