TUPE or the “Transfer of Undertakings (Protection of Employment) Regulations 2006” provides protection for employees when the business in which they are employed is transferred to a new legal entity.
TUPE seeks to protect your rights and prevent you from being treated unfairly when a business moves from one owner to another (TUPE does not apply to a share sale).
- The company or undertaking that is being transferred is the TRANSFEROR; and
- and the business taking on the undertaking is a TRANSFEREE.
The TUPE regulations also apply in certain situations when the business outsources a specific work function such as IT, finance, cleaning or HR. In situations where there is an identifiable and organised grouping of employees carrying out fundamentally the same tasks as the ones being outsourced, then these employees are also protected by the TUPE regulations. For example: if an employer decided to outsource its IT depart which consists of a team of employees, all known to the employer and carrying out the tasks that the employer is outsourcing, then the outsourcing would be caught by TUPE. In contrast, if the cleaning of a group of offices is being outsourced by an employer and the cleaning of the offices is undertaken by any one of an extensive team of cleaners then because the cleaner(s) are not identifiable then it is unlikely that TUPE will apply.
WHAT IS THE IMPACT OF THE TUPE REGULATIONS ON ME?
The purpose behind the TUPE Regulations is to protect the affected employees being transferred to the transferee. The TUPE Regulations stipulate that the contract between you and your old employer is transferred without any changes to your new employer. This is the opposite of the common law position, in which if either signatory to the contract changes, the contract itself is terminated automatically.
TUPE is intended to give you a greater degree of job security when your employer changes and there are only limited situations where changes to your contract of employment are permitted. Changes are allowed when there is an economic, technical and organisational reason behind them so for example a change in your place of work, is a permitted amendment for organisational reasons. Saying this, slightly different rules apply to pensions and other insurance backed employee benefits which are beyond the scope of this article.
Another valuable point is that your length of service remains unbroken and transferred employees are protected against being dismissed because of transfer (if the employee has 103 weeks' service).
DUTY TO INFORM & CONSULT
Most employers will confirm early on in the consultation process, whether there is any dispute between the transferor and transferee about whether the TUPE regulations apply. Both the transferor and transferee have a duty to provide information and engage in a meaningful consultation with affected employees about the potential transfer . As well as the duty to consult with employees individually the transferor also has a duty to consult with staff collectively (as a group) if your employer has more than 10 employees.
The information that should be provided to affected employees in writing includes:-
- details about when and why the transfer is going to happen;
- any social, legal or economic implication regarding the transfer, ie: a change of work place;
- any measures envisaged ie: if the transferor is intending to make redundancies;
- and details of any agency workers being used.
It is not uncommon when a transferee, as a result of a TUPE transfer, takes on transferred employees in addition to its existing employees that ta surplus of employees is created that could result in redundancies. Although redundancy is still a potential fair reason for dismissal, the transferee should still follow a fair and reasonable consultation process with all affected employees. All employees includes both the transferred and existing employees. If the transferee only puts the employees that have been transferred at risk of redundancy then those employees may have potential claims against their new employer.
If the transferor and transferee fail to inform and consult with the affected employees then the employees could bring a claim in the employment tribunal for up to 13 weeks' pay per employee, depending on the extent of the failure.
The TUPE regulations protect you from any subsequent dismissal or significant change to your terms and conditions that come about as a result of the transfer of ownership. If this happens, it may be classed as unfair dismissal depending on the circumstances.
TUPE is a very complex, fact-sensitive area of law and the information provided here is merely a short summary. If you find yourself in a situation where your employment is or has been transferred as a result of TUPE and you do not believe that you (and perhaps your colleagues) are being treated fairly after the business that employed you changed hands; or if you new employer changes the terms and conditions of your employment, you may well have a case against your new employer.
For more information about your rights, Ashby Cohen can help you. We specialise in employment law cases, and our years of experience as employment lawyers make us especially qualified to assist you with any TUPE issues you may have. Please contact us for an initial free consultation.
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