Case Analysis: Anne v Great Ormond Street Hospital — TUPE, Race Discrimination and Post-Transfer Pay

Citation

Anne & Others v Great Ormond Street Hospital for Children NHS Foundation Trust [2026] EAT (February 2026)

Issues

1. Whether the Trust's failure to move transferring employees onto Agenda for Change pay rates after a TUPE transfer constituted indirect race discrimination.
2. Whether the Trust could justify the difference in pay by relying on TUPE's prohibition on harmonisation.

Background

80 cleaners of BAME background transferred from an outsourced provider (OCS) to the Trust in August 2021. OCS had paid the London Living Wage (£10.75/hour). Trust employees in equivalent roles were paid Agenda for Change rates (£11.50/hour plus enhanced benefits). The Trust kept the transferring employees on their existing terms.

The Discrimination Analysis

The Practice

The EAT agreed that the Trust applied a practice of making receipt of Agenda for Change pay dependent on whether an employee had transferred from an outsourced provider.

Group Disadvantage

78% of the transferring employees were of BAME background, compared to 51% of Trust employees at equivalent bands. The practice therefore put BAME workers at a particular disadvantage.

Justification

The Trust sought to justify the difference in pay by relying on TUPE's prohibition on harmonisation. It argued that it could not change the transferring employees' terms because there was no ETO reason entailing changes in the workforce.

The EAT rejected this. The claimants' contracts contained a provision permitting unilateral changes to their terms. Because the Trust had the power to uplift their pay, it could not rely on TUPE's prohibition as a justification for maintaining the discriminatory practice.

Pre-Transfer Period

The EAT found no discrimination in the pre-transfer period. Following Royal Parks Ltd v Boohene [2023] EWCA Civ 1307, the Trust was not the employer pre-transfer and did not prohibit OCS from paying higher rates. The Trust's influence over the claimants' pay did not extend to prohibiting a particular rate.

Commentary

This decision has significant implications for any organisation that takes on staff through a TUPE transfer:

The TUPE defence has limits. Keeping transferring employees on lower terms "as is" can constitute indirect discrimination if the transferring workforce is disproportionately of a protected characteristic.

Contract terms are critical. Where a transferring employee's contract permits unilateral changes, the transferee may be unable to rely on TUPE's prohibition as a justification.

Due diligence must extend to diversity. Transferees need to understand the demographic composition of the transferring workforce. This is not currently required as part of the statutory employee liability information.

The decision applies beyond race. The same reasoning could apply to sex discrimination and equal pay claims where the transferring workforce is disproportionately female.

This case analysis is provided for general information only and does not constitute legal advice.