TUPE Law Solicitors
When businesses are sold or purchased, or contract providers are changed, organisations will need to consider their obligations under TUPE. Our team have extensive expertise advising on TUPE and can assist with any stage of the process.
What is TUPE?
TUPE stands for the Transfer of Undertakings (Protection of Employment) Regulations 2006.
It aims to protect employees when a business changes hands or there is a change of service provider. In those circumstances, if TUPE applies, some employees’ contracts will automatically transfer to the incoming business or provider. There are also enhanced protections afforded to such employees in respect of changes to their contract terms and termination of employment.
When does TUPE apply?
TUPE applies where there is a “relevant transfer”.
There are two types of relevant transfer:
- A transfer of an undertaking or business (in whole or part) where there is a transfer of an economic entity which retains its identity (Business Transfer)
- A client engages a contractor to carry out work on its behalf, engages a different contractor to do that work or brings the work back in-house (Service Provision Change)
Some transfers may be both a business transfer and a service provision change. There are also certain circumstances where TUPE will not apply.
TUPE transfer Employee rights
Affected employees will have the right to be informed and, potentially, consulted as part of the TUPE process. This is usually done via representatives for those employees but can, in certain circumstances take place with the employees themselves. There are obligations on both the transferor and transferee here and a failure to comply can result in substantial liability for both.
Employees will have enhanced protection in respect of contract changes. Any variation to an employee’s contract of employment following a TUPE transfer will be void if the reason for the change is the transfer itself. However, certain contract variations are permitted, for example those made due to an economic, technical or organisational (ETO) reason.
Employees also have enhanced protection against dismissals. Any dismissal of an employee will be automatically unfair where the reason for the dismissal is the transfer itself and there is no ETO reason behind this.
The TUPE transfer process
The TUPE process can be daunting but we can help you navigate this.
A typical TUPE process includes identifying the affected employees, Identifying or holding elections for appropriate representatives, informing and consulting with the appropriate representatives, supplying information to the other party (the transferor will need to provide statutory information known as ‘employee liability information’ and the transferee, will need to provide information relating to measures It envisages taking) and reviewing and drafting commercial terms relevant to the TUPE.
Parties will also want to undertake due diligence to fully understand their obligations and liability in a TUPE situation.
How can our TUPE Law Solicitors help?
TUPE is a fact sensitive and complex area. We offer clear, practical and jargon free support so that you can get to grips with TUPE and manage the process and expectations of those affected.
Our TUPE transfer solicitors can provide services including :
- Offering advice at an early stage as to whether TUPE applies
- Reviewing your commercial agreements and drafting terms to ensure your organisation has adequate protections in place including warranties and indemnities as necessary
- Assisting you with your due diligence process
- Offering advice on the TUPE process including obligations to inform and consult
- Creating bespoke training for employee representatives to assist them in their role
- Drafting and advising on communications to your employees, the transferor or transferee (as applicable) and others who may be involved in the process
- Assisting you with any claims from employees relating to TUPE
We can also advise individuals on their rights in a TUPE situation and assist them with claims where the process was not handled appropriately.
TUPE Podcast Series
TUPE can be a very complicated area of law to navigate and so we have designed a series of short podcasts to give you a really good overview of the basics.
1. When Does TUPE Apply? – Relevant Transfers
2. Service Provision Changes – Same Client and Fundamentally the Same Activities
3. TUPE Podcast Series: Service Provision Changes – Organised grouping and principal purpose
4. TUPE Podcast Series: Service Provision Changes – Single specific events or tasks of short duration
“An exceptional balance of expertise and personality.”
Legal 500
FAQs – TUPE
TUPE stands for the Transfer of Undertakings (Protection of Employment) Regulations 2006 which aim to protect employees when the business in which they work changes hands or there is a change of service provider.
If TUPE applies, the transferee (i.e. the new incoming business owner or service provider) takes on some of the rights and liabilities associated with the employees who were employed by the transferor (i.e. the old business owner or service provider).
The contracts of employment for employees employed by the transferor (i.e. the old business owner or service provider) and assigned to the ‘organised grouping of resources or employees that is subject to the relevant transfer’ will transfer automatically to the transferee (i.e. the new business owner or service provider) and continue unchanged, with the exception of some old age, invalidity and survivor benefits under occupational pension schemes.
Yes. Transferors are obliged to provide certain information (known as Employee Liability Information) about the transferring employees to the transferee at least 28 days before the transfer takes place. This includes the identity and age of the employees and certain information relating to the employees’ employment terms, disciplinaries, grievances, claims and collective agreements.
For TUPE to apply, there must be a change of employer. A genuine transfer of shares involves a change in the ownership of share capital only, not a change of employer, so TUPE would not apply. However, there may be TUPE transfers surrounding the share sale, for example if assets are moved around in preparation for the share sale or if after the transfer another company (such as a parent company) takes over the day to day running of the company.
Transferors are required to provide certain information to ‘appropriate representatives’ of their affected employees. If there are no representatives and, after being given an opportunity to elect representatives following a reasonable timeframe they fail to do so, the information must be provided to the affected employees themselves.
This information includes:
- The fact that a transfer is to take place, the date or proposed date of the transfer and the reasons for it;
- The legal, economic and social implications of the transfer for any affected employees;
- The measures, which it envisages it will, in connection with the transfer, take in relation to any of its affected employees (if no measures are envisaged it should state that);
- The measures, in connection with the transfer, that it envisages the other party will take in relation to its affected employees (if no measures are envisaged it should state that); and
- Suitable information relating to the use of agency workers e.g. the number of agency workers working for it, the parts of the business where they work and the type of work being carried out.
Transferors are also required to provide certain information (known as ‘Employee Liability Information’) to the transferee at least 28 days prior to the transfer. This includes the identity and age of the employees and certain information relating to the employees’ employment terms, disciplinaries, grievances, claims and collective agreements.
No, not on TUPE alone. TUPE operates to preserve employees’ existing terms and conditions, not to enhance them. There may be circumstances where employees are able to rely on TUPE in conjunction with something else, like equal pay legislation, to request enhanced terms but this will be dependent on the circumstances in each case.
The transferor must provide certain information about the transfer to the appropriate representatives “long enough before the relevant transfer to enable the employer of any affected employees to consult the appropriate representatives of any affected employees”.
The protection TUPE offers against dismissal and changes to terms and conditions has no set timeframe. If a significant period of time has passed since the transfer, then that may indicate that there is no connection between the transfer and the dismissal/change. However, it will not be determinative and each case will be decided by the tribunal on its own facts.
In the case of changes to terms which were incorporated from a collective agreement, there is an exception to this – as a change can be made provided it takes effect more than one year after the transfer, and the varied terms, when considered together, are no less favourable to the employee than the original terms. However, this latter part of the test is often a difficult hurdle to pass.
The protection TUPE offers against dismissal and changes to terms and conditions has no set timeframe. If a significant period of time has passed since the transfer, then that may indicate that there is no connection between the transfer and the dismissal/change. However, it will not be determinative and each case will be decided by the tribunal on its own facts.
In the case of changes to terms which were incorporated from a collective agreement, there is an exception to this – as a change can be made provided it takes effect more than one year after the transfer, and the varied terms, when considered together, are no less favourable to the employee than the original terms. However, this latter part of the test is often a difficult hurdle to pass.
TUPE can apply where there is a change between contractors – this is known as a service provision change.
In terms of the individuals affected, where TUPE applies the contracts of employment of all employees employed by the transferor and assigned to the undertaking or, in a service provision change assigned to the services, automatically transfer to the transferee.The definition of an ‘employee’ under TUPE is broader than that usually used for other forms of employment protection (such as unfair dismissal). It includes any individual who works for another person under a contract of service, apprenticeship or otherwise (except anyone providing services under a contract for services, i.e. in a genuine self-employed capacity).
Determining whether an individual is an employee is by no means an easy task and is extremely fact sensitive.
Contractors who are genuinely self-employed would unlikely be ‘employees’ for the purposes of TUPE.
