The Transfer of Undertakings (Protection of Employment) Regulations 2006 – also referred to as TUPE – exist in order to protect employees when a business changes ownership. This includes mergers of two or more companies.
Transfer of Undertakings (Protection of Employment) regulations apply in order to:
- Ensure that employees’ jobs, employment terms and conditions transfer
- Maintain continuity of employment
When do TUPE regulations apply?
TUPE regulations apply when a business based in the UK changes ownership or there is a change in service provision. The identity of the business owner must officially change in order for the transfer to be protected under TUPE regulations.
This may involve the entirety of the business or only a subdivision of the business. The size of the business does not affect whether TUPE regulations apply.
TUPE regulations also come into practice when outsourcing, insourcing and retendering takes place within a business.
The entire business need not be entirely British for TUPE regulations to apply. The head office of the company may be located elsewhere, for example. Provided that the part of the business changing ownership is situated within the UK, TUPE regulations apply to any employees affected.
TUPE regulations do not generally apply when employees are made redundant with the outgoing employer’s approval prior to the changeover, or the business goes into insolvency.
TUPE regulations also apply when a service provision changes within a business. This most commonly occurs when a service that has historically been provided in house, such as IT support, is outsourced to a separate contractor.
TUPE regulations will also apply when a contract comes to an end and a new contractor is given the contract going forwards. The change cannot be for the supply of goods and cannot only be for a short term.
If you are unsure whether TUPE regulations apply to you and would like more information, you can contact Citizens Advice or the representative of your trade union, if applicable.
What happens if you don’t comply with TUPE regulations?
In the absence of TUPE regulations, the new owner of a business would be free to treat employees like any other business asset, provided they adhered to contractual notice periods and other relevant legal requirements. Existing employees would therefore be vulnerable to dismissal.
TUPE regulations state that the new owner of a business – or part of a business – must take on all the responsibilities and liabilities of the former owner where employees are concerned.
This means that after the transfer of ownership:
- Employees’ terms and conditions of employment are not altered
- Employees are entitled to claim for unfair dismissal if they have been made redundant by the new owner following the transfer
- Both the new and previous owners of the business are obliged to consult the representatives of any employees affected by the transfer
What to do if you are unfairly dismissed due to a TUPE transfer?
When a business changes ownership, the new owner cannot make employees redundant simply because they have been transferred. Any redundancies must be made prior to the transfer with the previous owner’s consent.
If you believe that you have suffered an unfair dismissal as a result of a business transfer, we can help you. At Kew Law we specialise in providing our clients with local legal support from our branches in Essex and Suffolk.
We will use our extensive expertise to guide you through the process of defending your rights as an employee to secure the most favourable outcome in your case. We also provide no-obligation quotes for all our legal services.