Transfer of Undertakings (Protection of Employment) Regulations (TUPE) were originally introduced to help both employers and employees understand their rights when the business they manage or work for is taken over or sold. A UK adaptation of the European Union Business Transfers Directive, it forms a crucial part of UK labour law, protecting employers when the business they work for changes hands. TUPE ensures that employees are also kept informed and consulted when the business they work for is transferred.
On January 31 2014, new regulations came into effect which modified TUPE. Both businesses and employees should be aware of the changes as they impact upon them. What follows is a brief guide through those changes.
Most importantly these changes:
– Will, in some situations, permit TUPE consultation to satisfy collective redundancy consultation rules.
– Previously, work redundancies (even genuine ones) resulting from a change in a business’s location were automatically deemed unfair. The new regulations allow for necessary changes to the workforce “within the scope of economic, technical and organisational reasons entailing changes in the workforce”, thereby giving some room to move for businesses with regards to relocation.
– State that for there to be a TUPE service provision change, the service provision must be “fundamentally or essentially the same” as before the transfer. Previously, this was not clear in the regulations, though it confirms the position in case law.
– Allow microbusinesses (fewer than 10 employees) to inform and consult directly with employees.
– allow for the renegotiation of terms previously agreed in collective agreements one year after transfer. This is subject to any changes being no less favourable to employees.
– The transferor will be required to provide employee liability information to the transferee 28 days before the transfer. This change is applicable to transfers on or after 1 May 2014.
For further information, please contact me on 0203 078 5767 for a free consultation.