Do You Have A Tupe (Transfer of Undertakings, Protection of Employment)?
When buying or selling your business or transferring services your employees have legal rights. Failure to understand this could render you liable for compensation awarded to your employees.
So what do you need to know about Tupe?
Phew, that’s quite some heading and believe us it’s also quite a complex area to manage. Tupe applies when there is a ‘relevant transfer’ or a ‘service provision’ change due to the sale or transfer of the whole or part of an employer’s business or undertaking as a going concern to another employer within the UK.
Essentially as the name suggests, TUPE is designed to protect employees and their employment rights. There were amendments made to tupe in 2014 to the benefit of a transferee, some of these were:
- Being able to renegotiate terms of a collective agreement after 1 year
- Only existing terms in a collective agreement at the time of transfer apply to transferred employees employment with the transferee
- Provision of employee liability increased to 28 days
- Dismissal of a transferred employee is only automatically unfair if the reason is the transfer itself
- Significantly a change in location can be an ETO reason and as such any redundancies due to location will not be automatically unfair.
Excluding criminal liabilities and some pension rights a transferee (new employer) will have all other rights and liabilities transfer to it whilst the transferor (old employer) may still find itself liable dependant on its actions immediately before the transfer i.e. dismissing an employee because of the transfer.
All parties need to ensure legal compliance as the result of failing to do so could mean an unfair dismissal against both the transferor and transferee.
This can be a complex area of law, if you believe you have a tupe situation to manage either as the transferor or the transferee, please contact us to have a discussion about how we can assist you.