When an employer transfers all or part of their business to another entity, employees employed within that business should automatically transfer over to the new employer and their terms and conditions should remain the same.
The Transfer of Undertakings (Protection of Employment) Regulations 2006 (or TUPE for short) were designed to protect employees against unfair treatment when they transfer over to another employer.
Matters can become even more complicated where a business seeks to outsource a particular function, change a contractor who provides a particular service or bring a particular function back in house (described by TUPE as a “service provision change”). TUPE includes a series of rules which mean that any of these actions would also create rights for employees and obligations for employers to preserve employment relationships and terms and conditions of employment.
Whenever a business is to be transferred or be party to a service provision change, planning is key to enable all potential costs, obligations and legal liabilities to be addressed. Furthermore, where a TUPE transfer is taking place, employers have a distinct obligation to inform and consult with employees affected by that transfer about any measures which may be taken in respect of their employment.
TUPE is one of the most complicated areas of employment law and we have a great deal of expertise in advising clients on the issues that need to be considered to ensure their legal rights and obligations are properly considered.