Business transfers and contracting out: Compulsory competitive tendering in tatters?

Compulsory competitive tendering (CCT) and market testing are central and controversial planks of government economic policy. Critics question the level of efficiency gains which flows from the process and point to the deterioration of workers′ terms and conditions of employment in the aftermath of contracting out exercises. Recent case law, in extending employment protection rights to workers caught up in contracting‐out exercises, may make CCT a much less attractive proposition to private contractors. Analyses recent developments and, in the context of the draft revised directive on business transfers, poses the question whether CCT is destined to become a failed economic experiment.