Case Analysis: Mach Recruitment Ltd v Oliveira [2025] EAT 107 — Agency Workers and TUPE

Citation

Mach Recruitment Ltd v Oliveira [2025] EAT 107

Issue

Whether a service provision change under TUPE can occur where one temporary work agency takes over work from another, and whether agency workers can constitute an "organised grouping of employees" for the purposes of the SPC provisions.

Background

The claimant was a temporary worker supplied by an outgoing agency to carry out work for an end client. When the end client switched to a new agency, the question was whether the workers transferred under TUPE.

The Legal Framework

A service provision change under reg.3(1)(b) TUPE requires:

1. Activities carried out by one contractor on behalf of a client are taken over by another contractor.
2. Immediately before the change, there is an organised grouping of employees situated in Great Britain which has as its principal purpose the carrying out of the activities concerned on behalf of the client.
3. The client intends that the activities will, following the change, be carried out by the new contractor other than in connection with a single specific event or a task of short-term duration.

The key issue was whether agency workers could constitute an "organised grouping of employees" for the purposes of condition 2.

The EAT's Decision

The EAT held that agency workers can fall within the SPC provisions. The fact that the workers were employed by an agency rather than directly by the outgoing contractor did not prevent the SPC provisions from applying. What mattered was whether the group of workers was organised principally to carry out the relevant activities for the client — and on the facts, it was.

Implications

For businesses switching staffing agencies: If a group of agency workers is principally assigned to carry out activities for a particular client, and that client switches agencies, those workers may transfer under TUPE to the new agency. The new agency would then be obliged to take them on their existing terms and conditions.

For agencies: Agencies should consider whether TUPE applies when they take on a new client contract that was previously serviced by another agency. If it does, they may be obliged to offer employment to the transferring workers on their existing terms.

For end clients: End clients should consider the TUPE implications of switching agencies, particularly where the same group of workers has been carrying out the relevant activities for a significant period.

Commentary

This decision extends the reach of the SPC provisions to agency workers, which is a significant development. Businesses that regularly switch staffing agencies should review their arrangements in light of this decision and take advice on whether TUPE applies.

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