Identifying an entity

Case 1: The facts

Carilto Abler worked for a contractor with a contract to run a hospital catering service. The hospital was dissatisfied with the service provided by the company and awarded the contract to Sodexho.

Sodexho did not take over the material, stock nor employees of the old contractor. It did, however, use the same premises and equipment as the old contractor.

The ruling

The European Court of Justice (ECJ) held that a catering activity could not be based solely on manpower, since it requires a significant amount of equipment. Therefore, just because the staff were not transferred, this did not mean that there was no relevant transfer.

Tangible assets - identified as the premises, water and energy and small and large equipment - were taken over by Sodexho, and indeed most of the customers (patients) of the old contractor also were taken over by the new company.

This meant that Sodexho should have taken over the staff, and those staff had the right to bring dismissal claims against it.

The court also made it clear that the lack of a contractual relationship between the old and new contractors was not relevant.

Abler v Sodexho Case [2004] IRLR 168