Benefits officers dismissed after contract ends: TUPE transfer confirmed
Two benefits officers dismissed by Serco when a council contract ended have won a preliminary ruling that their employment should have transferred to the council under TUPE.
1 min read · Last updated 18 May 2026
Case details
- #tupe
- #service-provision-change
- #benefits-officers
- #outsourcing
- #preliminary-hearing
Key facts
- The claimants were employed by Serco as Benefits Officers working on a contract with Southend-on-Sea Borough Council.
- Serco terminated the contract on 2 July 2020, and the claimants were dismissed on 3 July 2020.
- The tribunal found that there was a relevant transfer of an undertaking under TUPE from Serco to the Council.
- The claimants were assigned to the organised grouping of employees that transferred.
- The Council had reduced the work allocated to Serco from May 2020, but the tribunal found no substantial reduction in overall processing work.
Timeline
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Contract signed
Serco and Southend-on-Sea Borough Council entered into a contract for the provision of caseworkers for remote processing of benefits.
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First Claimant assigned to contract
Mrs Lindley joined the team working on the contract.
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Second Claimant assigned to contract
Miss Coutts joined the team working on the contract.
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Serco verbally informed Council of termination
Serco told the Council it was terminating the contract due to exiting the benefits market.
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Written notice of termination
Serco provided written notice, stating its view that TUPE applied and 10 employees were in scope to transfer.
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Council requested reduction in resource
The Council asked Serco to remove 4 full-time equivalent employees from the contract.
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Council requested no further resource
The Council stated it would not need any resource from Serco from 18 May 2020.
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Council removed Serco's system access
The Council suspended Serco's access to its document management system, stopping all processing work by Serco.
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Contract terminated
The contract between Serco and the Council ended.
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Claimants dismissed
Serco terminated the employment of both claimants.
The legal issue
The tribunal had to decide whether the end of a service contract for benefits processing amounted to a 'service provision change' under TUPE, and whether the two benefits officers were assigned to the group of employees that should have transferred to the council.
The outcome
The tribunal ruled that there was a relevant transfer under TUPE when Serco's contract with Southend-on-Sea Borough Council ended on 2 July 2020. The two benefits officers were assigned to the organised grouping of resources that transferred, so their contracts of employment should have transferred to the council.
As a result, the following claims can proceed to a final hearing:
- Automatically unfair dismissal under TUPE against the council
- Unfair dismissal under the Employment Rights Act 1996 against the council
- Failure to inform and consult under TUPE against both Serco and the council
No compensation was awarded at this preliminary stage.
Lessons & takeaways
- If you are dismissed when a service contract ends, check whether TUPE applies — your employment may have transferred automatically to the new contractor or client.
- Even if the client reduces work before the contract ends, a TUPE transfer can still occur if the activities continue to be carried out by the client.
- If your employer argues TUPE does not apply, you can ask the tribunal to decide this as a preliminary issue before the main hearing.
- A claim form that does not strictly follow the prescribed format may still be accepted if it contains sufficient particulars.
What this case shows
Two benefits officers working for Serco on a contract with Southend-on-Sea Borough Council were dismissed when Serco terminated the contract. The council argued that there was no TUPE transfer because it had reduced the work allocated to Serco and eventually stopped it altogether. However, the tribunal found that the activities — remote processing of benefits — continued to be carried out by the council after the contract ended. The reduction in work was not substantial enough to prevent a service provision change.
What the losing side could have done differently
The council could have recognised that TUPE applied and taken on the employees, avoiding the need for dismissals. Serco, for its part, could have properly informed and consulted with the employees about the transfer. Instead, the claimants were left to bring tribunal claims to establish their rights.
Why this matters
This case is a reminder that TUPE applies even when a client reduces work before a contract ends, as long as the activities are fundamentally the same. Employees in outsourced roles should be aware that their employment may transfer automatically, and employers should not assume that a reduction in work volume negates a transfer.
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