Change of suppliers was not a transfer of undertakings

Case no. 23/2015
Judgment delivered on 28 October 2015

3F acting for A
vs.
ISS Facility Services A/S
Claus Tingstrøm A/S

The case concerned whether the dismissal of canteen employee A in connection with a change of suppliers was in violation of the Act on Transfer of Undertakings. The parties were particularly divided on whether ISS Facility Services A/S's takeover of the canteen services at KPMG from A's employer Claus Tingstrøm A/S was covered by the Act on Transfer of Undertakings. The Maritime and Commercial Court had come to the conclusion that the case was not covered by the Act.

The Act should be interpreted in accordance with the Directive on Transfers of Undertakings. According to the Directive, there is a transfer "where there is a transfer of an economic entity which retains its identity".

The Supreme Court held that the Act on Transfer of Undertakings did not apply to this situation, where ISS Facility Services A/S successfully bid for KPMG's canteen services and took over operation of the canteen at the same as KPMG moved to new premises. ISS Facility Services A/S did not take over any staff or kitchen facilities or machinery and equipment from Claus Tingstrøm A/S. The latter continued to offer canteen services in the old building, where its revenue had fallen by 80% after KPMG's move. According to an overall assessment of the facts, the Supreme Court agreed that "no transfer of an economic entity which retained its identity" had taken place.

The Supreme Court thus affirmed the ruling of the Maritime and Commercial Court.