TUPE and Business Re-organisations

TUPE strikes fear in the hearts of many employers and advisors. However, with our extensive experience in dealing with TUPE situations there need not be such fear.

TUPE is complex - in essence it applies when the ownership of a business transfers or a service provider changes. TUPE ensures that everything remains the same for the employees other than the change in ownership and possibly name.

Dismissals

If an employer dismisses an employee because of a transfer that dismissal will be deemed unfair.

However, dismissals on a transfer are permitted in certain circumstances for example: where the employer is able to argue that the transfer was not the principal reason for the dismissal rather there was an economic, technical or organisational (ETO) reason which entailed a change in the workforce.

The definition of what constitutes an ETO reason has been controversial and has made dismissals following a transfer difficult.

Informing and Consulting Employees

The TUPE Regulations require employers to inform and consult with staff on specified matters prior to a transfer. The requirements of the consultation can be onerous and are often ignored. The penalty for failing to adhere to them is severe - 13 weeks gross pay for each affected employee.  

On 31 January 2014 significant changes to the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) come into force. For more information on these changes please click here.