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THE NEW European Court of Justice ruling on Tupe could make local authority in-house departments more competitive against tendering bids from private firms, according to a leading employment lawyer.
Dr John McMullen, who heads Pinsent Curtis's employment practice, said the ruling that workers' rights are not automatically protected under a changeover of service contracts would mean that bidders for legal services would, unlike council departments, be forced to build possible redundancy payments into their contract tendering price.
The change in the law, known in the UK as the Transfer of Undertakings (Protection of Employment) Regulations 1981, or Tupe, will affect 250 councils.
Doncaster Council chief solicitor Nicholas Dobson said the Ayse Suzen v Zehnacker judgment had thrown Tupe law into renewed uncertainty.
"I think it creates a lot more uncertainty and therefore more work for council lawyers and authorities."
But Cambridgeshire Council commercial solicitor Rosemary Boyle said the court had been seeking to clarify aspects of Tupe. She was not surprised the court had sought to restrict the scope of the Acquired Rights Directive, as there was a tension between employees' rights and the free movement of goods and services.