TUPE templates toolkit

TUPE is the Transfer of Undertakings (Protection of Employment) Regulations. Its purpose is to protect employees if the business in which they are employed changes hands. Its effect is to move employees and any liabilities associated with them from the old employer to the new employer by operation of law.

TUPE can apply when employers:

• sell or buy part or all of a business as a going concern;

• outsource or make a "service provision change" involving either (a) an initial outsourcing of a service (e.g. where services transfer from the customer to an external contractor); (b) a subsequent transfer (e.g. where services transfer from the first external contractor to a different external contractor; and (c) bringing the service back in-house (e.g. where services transfer from an external contractor back to the customer)

• grant or take over a lease or licence of premises and operate the same business from those premises.

TUPE has impacts for the employer who is making the transfer (also known as the outgoing employer, the old employer or the transferor) and the employer who is taking on the transfer (also known as the incoming employer, the new employer or the transferee).

• Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE):

  • Applies to situations where a business or part of a business is transferred to a new employer or where a service provision change occurs.

  • Provides protection to employees' terms and conditions of employment during a business transfer or service provision change.

  • Ensures continuity of employment for transferred employees.

  • Requires employers to inform and consult with employees affected by the transfer or service provision change, as well as any trade unions or employee representatives, and provide them with information about the reasons for the transfer, the impact on employees, and any measures planned to be taken in relation to employees.

  • In addition:

    • The employment contracts of affected employees must be transferred to the new employer or service provider, and employees must be given the same terms and conditions of employment that they had with the previous employer, including continuity of employment.

    • Employees have the right to object to the transfer or service provision change if it would result in a substantial change to their working conditions or a breach of their employment contract.

    • Employers must not dismiss or make any changes to the terms and conditions of employment of employees affected by the transfer or service provision change solely because of the transfer, unless there is an economic, technical, or organisational (ETO) reason for doing so.

    • Employers must provide appropriate training and support to employees affected by the transfer or service provision change to help them adapt to their new working environment and job responsibilities.

It is important for employers to comply with TUPE regulations to avoid any potential legal challenges and to protect the rights and welfare of employees affected by a transfer or service provision change. In addiition the following legislation supports a successful transfer:

• Employment Rights Act 1996:

  • Safeguards employees' rights in relation to unfair dismissal and redundancy.
  • Protects against detrimental treatment or dismissal due to the transfer.

• Equality Act 2010:

  • Prohibits discrimination on the grounds of age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, and sexual orientation.
  • Ensures equal treatment and protection from discrimination during a transfer.

• Trade Union and Labour Relations (Consolidation) Act 1992:

  • Preserves employees' rights to collective bargaining and trade union membership during a transfer.
  • Protects against unfair dismissal for reasons related to trade union membership or activities.

• Working Time Regulations 1998:

  • Safeguards employees' rights regarding working time, rest periods, and annual leave entitlements.
  • Ensures that these rights are maintained during a transfer.

• National Minimum Wage Act 1998:

  • Guarantees that employees receive at least the statutory minimum wage.
  • Maintains this protection during a transfer.

• Transfer of Employment (Pension Protection) Regulations 2005:

  • Safeguards employees' pension rights during a transfer.
  • Ensures continuity of pension provision and protection of accrued pension benefits.

• Employment Rights Act 1996 (Part XII):

  • Provides protection against unfair dismissal due to the transfer.
  • Preserves employees' rights and terms and conditions of employment.

• Protection of Employment (Redundancy Payments) Regulations 1997:

  • Protects employees in the event of redundancy during a transfer.
  • Ensures they receive redundancy payments as per statutory entitlements.

PROCESS

The correct order to issue the documents follows the logical sequence of the TUPE process, starting with notifying employees about the possibility of a transfer and requesting necessary information, then moving onto the election of employee representatives and consultation with them regarding proposed measures. Next, the measures themselves are communicated and a ballot is conducted if necessary. Finally, confirmation of the transfer is given to representatives and employees, followed by communication regarding employee liability information and welcome/goodbye letters.

Navigating TUPE processes correctly is crucial to help you avoid any problems (which can be costly in terms of time, money and reputation).

Recent UK case law has highlighted key aspects of good TUPE management. Knowing how courts have handled claims can help you assess whether your proposed actions are likely to be seen as reasonable.

Here are some notable rulings and their implications:

• Tabberer v Mears Ltd (2018):

  Outcome: The Court of Appeal clarified that changes to terms and conditions after a TUPE transfer are valid only if the primary reason is not the transfer itself.

  Key takeaway: In this instance, the removal of outdated travel allowances was deemed legitimate because the primary reason was the employer's belief that the allowances were obsolete, not the transfer.

• London Borough of Barnet v Ms E Green (2017):

  Facts: This case involved a dispute over whether a redundancy exercise constituted a TUPE transfer.

  Outcome: The Court of Appeal ruled that for TUPE to apply, there must be a transfer of an economic entity which retains its identity.

  Key takeaway: The judgment emphasised that employers must carefully assess whether TUPE applies in redundancy situations involving outsourcing or insourcing.

• Inex Home Improvements Ltd v Hodgkins (2018):

  Facts: In this case, a two-month layoff period did not prevent TUPE from applying because the organised grouping of employees still existed at the point of transfer.

  Outcome: The courts ruled that a temporary cessation of services does not necessarily negate the application of TUPE.

  Key takeaway: This ruling affirmed that temporary breaks in service do not invalidate TUPE protections as long as the organised grouping remains intact.

Here are some conplex but common TUPE-related workplace scenarios that need careful planning and execution to resolve.

We show you the steps to take to manage the specific case, along with what you should consider doing to minimise and mitigate any repeat.

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