TUPE and employment law
TUPE comes into effect when the criteria laid out in the TUPE Regs is met. This will mean that all employment contracts with the original service provider or business owner (Transferor) are automatically transferred to the new one (Transferee). Identical terms and conditions of employment must be maintained.
TUPE regulations for the Transferor:
The complexity of the rules governing TUPE transfers has to be taken into account. Before the transfer takes place, all affected staff must – by law – have a consultation with both the Transferor and the Transferee, through their trade union or employee representative.
Written information about all employees concerned and their contracts must be provided by the Transferor to the Transferee prior to the transfer. This is referred to as provision of the notification of employee liability information (NELI).
Once the employer becomes aware that the transfer will be going ahead, TUPE forbids alteration to current contract terms.
Post-transfer, the Transferee must ensure:
The previous terms and conditions of employment for all affected employees are maintained. This includes any accrued holiday entitlement. The Transferee is obliged to provide a pension scheme meeting minimum standards laid out in the Pension Act 2004, and which is equal to the scheme implemented by the Transferor, though actual pension rights will not transfer.
In certain circumstances cuts to the workforce can be made post-transfer; however, only if there is an economic, technical or organisational (ETO) reason. If you think this might apply you should contact the 24 hour advice line for expert assistance. Original and transferred employees qualify for the same redundancy payments and should be given the same consideration if you do need to make redundancies.
It is worth noting that failing to adhere to TUPE regulations or not providing a TUPE consultation could lead to employers being taken to employment tribunal for unfair dismissal or for failure to consult. UK-based Transferors with employees overseas, as well as small businesses, are all covered by TUPE. Peninsula clients can learn more about TUPE through the BusinessWise advice centre, or browse the employers advice guide for information on any employment law topic.
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