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The extent of gold-plating

31 January 2011

Shortly after coming in to power the coalition government announced that it would end the “gold-plating” of EU directives – the practice implementing them in such a way that gives employees more generous entitlements. A recent European case shows the extent of the problem.

CLECA SA v Valor is a Spanish case where a local authority contracted out its cleaning services, and then brought them back in house. No assets where transferred in the process. The European Court of Justice held that this was not a transfer of undertakings under the Acquired Rights Directive, and as such CLECA’s cleaners did not transfer to the local authority’s employment.

In the UK the Acquired Rights Directive is implemented by the TUPE Regulations. A case on identical facts would be a transfer under TUPE. Given that such contracts are often terminated or transferred because of dissatisfaction with the current contractor’s performance, this situation is obviously more disadvantageous for UK employers than elsewhere in Europe.

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