In order to establish whether there is a transfer of undertaking, there must be:
1. an undertaking (economic entity). An economic entity as defined in article 1 (b) of the Acquired Rights Directive as is an organised grouping of resources which has the objective of pursuing an economic activity. It must be stable, enabling the exercise of an economic activity pursuing a specific objective, but may not be reduced to an activity. In order to have an economic entity, there should be autonomy: the unit should be sufficiently independent. This concept of independence refers to the powers, granted to those in charge of the group of workers concerned, to organise, relatively freely and independently, the work within that group and, more particularly, to give instructions and allocate tasks to subordinates within the group, without direct intervention from other organisational structures of the employer (see, in that regard, Scattolon, paragraph 51). Whilst the presence of a sufficiently autonomous entity is not affected by the fact that the employer imposes precise obligations on that group of workers and thus has an extensive influence on its activities, it is nevertheless necessary that that group possess a certain freedom to organise and carry out its tasks
2. that entity should transfer to a new employer. This means, given the Spijkers case, that the entity should have retained its identity: the business should be disposed of as a going concern, the operation is actually resumed by the new employer. The Spijkers criteria should be assessed.
3. lastly, the transaction should be based on “contractual relations”, which is broadly interpreted.
Here, there is a contract between Rotterdam Verzekert B.V. and Insource B.V. There are therefore contractual relations. The entity also seems to have retained its identity: the same work is continued with more or less the same employees and the same assets. The unit, however, cannot be qualified as an economic entity, as there is insufficient autonomy. The three employees all have the same hierarchical level and perform more or less the same tasks within each unit. There only supervisor, Mandy, is not part of the entity. The conclusion should therefore be drawn that there is no transfer of undertaking, as the unit cannot be regarded to be an entity.
Can an employee under the employment agreement has transfer due to the transfer of undertaking?
Pursuant to article 3 (1) of the Directive, the employment agreements of the employees transfer from the transferor to the transferee. However, does the so called "employee" ‘belong’ to the unit that transferred? According to the ECJ (C-186/83, Botzen), an employment relationship is characterized by the link existing between the employee and the part of the undertaking to which he is assigned to carry out his duties. In order to decide whether the rights and obligations under an employment relationship are transferred within the meaning of the Directive, it is sufficient to establish to which part of the undertaking the employee was assigned. In the case at hand the three employees are assigned to the unit, whilst the "employee" is not. In consequence, she does not transfer from her initial employment status to the next.
Comments