TUPE

What do we mean by TUPE?

It is a piece of legislation called “The Transfer of Undertakings (Protection of Employment) Regulations 2006” and TUPE affects many more businesses than you may think.

In today’s evolving business market, it is more important than ever to know about the TUPE Regulations and how it could impact your business. 

It is difficult, in this blog, to give a full briefing of the TUPE Regulations, however what we hope to achieve is to help you identify a TUPE scenario and by doing so help you to be more alert to the TUPE Regulations. 

In order to help you identify a potential TUPE issue you should consider if any of the following scenarios apply:

  1. You are considering selling all or part of your business.
  2. You are purchasing a business.
  3. You are outsourcing your IT services, your cleaning contract or other in-house service for the first time.
  4. You are bringing back in house previously outsourced services.
  5. You are considering changing Service Provider for any outsourced services.

If any of these do apply, then you need to be aware of the TUPE Regulations and their implications.

In short, the TUPE Regulations protect employment rights.

When TUPE applies, the employees of the outgoing employer automatically become employees of the incoming employer at the point of transfer. They carry with them their continuous service from the outgoing employer, and should continue to enjoy the same terms and conditions of employment with the incoming employer.

For example, if you are selling your business, the general rule is that all employees in the business will transfer to the purchaser on completion with all their employment terms (including continuity of services) protected. If you are the potential purchaser of a business this is a liability you will need to consider as part of any commercial offer. 

Following a transfer, employers often find they have employees with different terms and conditions working alongside each other and wish to change/harmonise terms and conditions. However, TUPE protects against change/harmonisation for an indefinite period if the sole or principal reason for the change is the transfer. Any such changes will be void.

The TUPE Regulations also provide enhanced protection against dismissal over and above general unfair dismissal law for employees with (at least) the qualifying period of service. Dismissals will be automatically unfair if the sole or principal reason for the dismissal is the transfer itself. 

One area in relation to the TUPE regulations which can be perplexing is the protection of employees in the event of a Service Provision Change.

Service Provision changes can potentially occur in the following situations:

  • A contractor takes over activities from a client (known as outsourcing).
  • A new contractor takes over activities from another contractor (known as re-tendering).
  • A client takes over activities from a contractor (known as in sourcing).

The scenarios 3-5 in the numbered list above will give you an idea of how a Service Provision Change could come about in practice.

So beware of the TUPE Regulations and if you think you may be affected by the Regulations then please get in touch for further information on this or any other employment issues.

 


We are the HR and employment law experts from esphr.

It’s our mission to advise and develop the employment law capability of HR professionals wherever we can, helping HR teams make a real commercial difference to their organisations. That way, you spend less time solving operational issues and more time actioning projects that drive far-reaching change in your company.

Call 0333 006 2929 or email info@esphr.co.uk today to discover exactly how we can help you.