Skilled workers will need to have a certificate of sponsorship from a licensed employer. The employment will attract a certificate of sponsorship if 50 points can be amassed with reference to qualifications (NVQ 3 level or above), earnings and the type of role (e.g. is a shortage occupation, and intra-company transfer or does it pass the resident labour market test). Unlike the current system, all sponsored workers will need to show basic English language skills and that they have enough savings to maintain themselves in the UK. The Government is looking at setting this maintenance level at £800, plus £600 per dependent.

The proposals for tier 5 include the replacement of the training and work experience scheme and the much loved and used, working holidaymaker visa. There are big steps away from the current arrangements in this tier, including that employers will not be the sponsoring body for work experience permits, a new administrative body will be set up to issue the required certificates and manage the scheme overall. However, the visas will be for o 24 months, instead of the current 12 months.

The working holidaymaker scheme is replaced by the potentially wider, youth mobility scheme. It will apply to countries, including those outside of the former Commonwealth, where there are reciprocal arrangements in place. Individuals will need at least £1600 of funds available for maintenance. The visa will be for 2 years and it seems that there may be no limit on the period during which the individual may work. Individuals previously here as a working holidaymaker will not be able to return under this category.

For full details, please click here.

Or contact our immigration experts:

	Michael Bradshaw, Partner michael.bradshaw@charlesrussell.co.uk +44 (0)20 7203 5045
	Caroline Blaydon, Paralegal caroline.blaydon@charlesrussell.co.uk +44 (0)1223 465 408

Service provision change or contract obliteration?
One of the main changes made when TUPE 2006 was introduced related to clarifying when a service provision change would come within the scope of the Regulations, but there have been few cases on the point. In Thomas-James and ors v Cornwall County Council and ors a tribunal found that there was no "service provision change" where it was not possible to identify the entity to which the service provision contract had been transferred.

The facts of the case involved seventeen companies which had contracts with the Legal Services Commission (LSC) to provide free legal advice services over the telephone. Callers to a national number would be routed to an available adviser from one of the seventeen contractors. Each contractor was allocated a certain number of hours of service to fulfil and had to employ one adviser for each 1100 hours of service allocated. The claimants were all employed by Cornwall County Council which had a dedicated team servicing the LSC contract.

In September 2006 LSC decided to put the contracts out for tender. The Council chose not to bid for a new contract. After the re-tendering exercise had been completed the total number of service providers was reduced to nine and the work previously carried out by the Council was dispersed among the remaining contractors. When the claimants' employment terminated on 31 March 2008 both they and the Council contended that their contracts of employment had transferred to one of the new service providers. The service providers denied this and the issue for the tribunal was whether there had been a relevant transfer.

It was accepted that if there was a transfer it would be a "service provision change" as the claimants were assigned to an organised grouping of employees that had as its principal purpose the carrying out of activities on LSC's behalf. However, the employment judge held that because it was not possible to identify to whom the hours previously allocated to the Council were allocated there was no connection between the activities performed by the claimants as employees of the Council and those performed by the nine service providers after April 2007.

Although a service provision change does not require the identity of the activities to be retained after the transfer the judge held it was crucial that there be a "nexus" between the activities carried out by the outgoing contractor and those carried out by the incoming contractor. He also accepted that the service provision changes apply where the activities of the outgoing contractor are split up, but held it is still critical that the transferee who carries out the new activities can be identified. In this case, as it was not possible to identify to which of the new service providers the Council's activities had transferred there was no relevant transfer.

This is a first instance decision but is an interesting analysis of the operation of the service provision change provisions. Whilst it is a practical approach, as determining where the employees should transfer in such a scenario would be a fraught process, it does not sit well with the wording of the Regulations.

Trying to avoid TUPE - Whose motives are relevant when determining the reason for dismissal?
In the case of Dynamex Friction Ltd and Another v Amicus and Others the Court of Appeal found that only the reasons of the person who actually made the decision to dismiss should be taken into account when determining the reason for dismissal. Here the administrator had carried out the dismissal, and his reasons for the dismissals were economic and not transfer related. The Court of Appeal accepted that whilst the eventual transferee may have stage managed the dismissals, this was immaterial as it had not affected the administrator's decision.

Craig Smith was the sole director of Friction Dynamics. The company got into difficulties and joint administrators were appointed, one of the administrators immediately dismissed all of the workforce on the basis that the company had no money to pay them. Following that they sought offers from nine interested parties for the sale of the business as a going concern.

Dynamics' parts and machinery were sold to Ferotec Realty Limited, a company controlled by Mr Smith which already owned Dynamics' premises. The production line and customers were taken over by Dynamex Friction Limited, a new company set up by a former Dynamics employee with assistance from Mr Smith and in which Mr Smith acquired a controlling shareholding several months after the transfer. Sixty (out of ninety-three) of the former employees were employed on new terms and conditions.

Some of the former employees, who had not been taken on by the new company, presented claims for unfair dismissal and failure to consult. At the Tribunal the union argued that Mr Smith had set up the administration of Dynamics so that he could transfer his business to Dynamex and/or Realty. The Tribunal rejected this argument and found that the ultimate transfer to Dynamex and Realty was not pre-planned. The sole reason for the dismissals was economic as there was no money to pay the workforce and so was not transfer related.

The Court of Appeal upheld the Tribunal's decision and confirmed that when considering whether the reason for a dismissal is economic or transfer related, a Tribunal should analyse the thought process of the person who made the decision to dismiss. If the actions and motives of others do not impact on that decision they do not need to be taken into account. Therefore in the absence of evidence of collusion between Mr Smith and the joint administrator, the Tribunal was correct not to have regard to Mr Smith's motives when determining the reasons for the dismissal.

Employer liable for employee's suicide
In Corr (Administratrix) of the Estate of Thomas Corr Deceased v IBC Vehicles Limited the House of Lords upheld the Court of Appeal's decision that the employer was liable under the Fatal Accidents Act 1976 for the suicide of a former employee who suffered from severe depression as the direct and foreseeable results of being seriously injured in an accident at work.

Mr Corr was a maintenance engineer for IBC Vehicles and in 1996 suffered a very severe injury at work when he was nearly decapitated. He underwent long and painful reconstructive surgery to his right ear, remained disfigured and suffered from mild tinnitus and severe headaches. Prior to this he had no history of psychiatric problems, but subsequently he suffered from post traumatic stress disorder and depression. Six years after the accident he committed suicide by jumping off the top of a multi storey car park.

When the matter reached the House of Lords, the issue to be dealt with was whether the damages claimed in respect of Mr Corr's suicide were too remote. The House of Lords found that they were not.
This case demonstrates that employers must be alive to the risk that where an employee suffers depression and/or psychiatric illness, it is open to the Court to find that the employer is liable for all the reasonably foreseeable consequences flowing from that injury even where it results in suicide. Not all cases will be as clear as this where it was not disputed that the only effective cause of the suicide was the severe depression arising as a result of the accident. Where a deceased has previous mental health problems and/or reasons independent of the accident that led to depression and suicide, deciding what compensation, if any, the employer should pay will not be a straightforward process.

Changing terms: Time to make a choice...
The case of Robinson v Tescom Corporation is an example of where an employee, when faced with new terms and conditions, must pick one course of action otherwise he could get into difficulties.
Mr Robinson was a territorial manager selling components for Tescom Corporation responsible for the South East of England. He covered an area from Great Yarmouth to Slough.

Following restructuring it was proposed that Mr Robinson's area be extended to include the whole of the South of England from the Wash to Mid Wales. Mr Robinson said that he would work under the terms of the varied job description, but under protest, stating that he did not accept the terms and was treating the change as a breach of contract.

Following a grievance from Mr Robinson, the managing director concluded that the proposed change to Mr Robinson's area of responsibility was necessary and that the impact of the change on his role was reasonable and that it would be implemented with effect from 16 October 2006. On 25 October Mr Robinson wrote to Tescom stating that he refused to accept the new terms and conditions and would continue in his role of Territory Manager covering South East England.

Mr Robinson was subsequently disciplined for failing to follow a reasonable management instruction and dismissed for gross misconduct. He complained to an Employment Tribunal for unfair dismissal, but this was dismissed and he subsequently appealed to the EAT. The EAT found that he had confused the options of working under the varied terms under protest and refusing to work under the varied terms. In both cases the contract continues but in the former case it is up to the employee to decide whether to continue to work under the new terms and claim ongoing breach of contract or to resign and claim constructive dismissal. In the latter case the onus is on the employer as to whether to permit the employee to work under their old terms of employment or dismiss them.

Mr Robinson should have either not tried the new job at all and refused to work under the new terms in which case, had he been dismissed; he may have had a claim for unfair dismissal. Alternatively, he could have worked for a trial period in the new job and if he had found it to be unacceptable, he could still have resigned later and had an arguable case for unfair dismissal. Mr Robinson however prejudiced his position by mixing up the options.

For more information about our Employment & Pensions Team please contact Jo Wort at joanna.wort@charlesrussell.co.uk

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