The acronym TUPE refers to the Transfer of Undertakings (Protection of Employment) Regulations. It's a significant and sometimes complex piece of legislation brought in by the UK to ensure compliance with the European Acquired Rights Directive. TUPE transfers protect the employees of a business when that business is changing hands. The definition from the 2006 Regulations states that it applies to a "transfer of an economic entity which retains its identity".
Why is TUPE so important?
The purpose of TUPE is largely to maintain the employment situation for employees and ensure that it does not change simply because there is an incoming employer taking over. It's an important piece of legislation because it applies to many types of businesses and it's essential that employers understand exactly what their liabilities are. Employment lawyers can provide clarification on this.
Due to the complexity of this area of law, it's advisable to take legal advice immediately if you think that TUPE transfers are going to feature as part of a business transaction. In this section Oratto features a number of employment lawyers who have proven experience in employment law and specifically TUPE transfers. Oratto is a web-based platform which links solicitors in diverse and exacting fields of law with potential clients who have specific needs .
To be referred to the most appropriate lawyer, you can use the Oratto Match function by supplying us with your details and we will choose a lawyer with the right experience for your circumstances. Oratto is a swift, simple method of accessing high quality legal services.
When does TUPE apply?
There are a number of typical business transfer circumstances in which TUPE wil be applicable, bearing in mind its underlying objective of protecting existing employee rights. For example, when the following situations have occurred:
- when there has been a service provision change (such as outsourcing) and this can be the case whether this is an initial or a subsequent transfer, or where the services are being transferred from an external contractor back to in-house supply
- a licence or lease of premises has been taken over to operate the same business from those premises
- if part or all of a business has been bought or sold as a going concern
- if any assets, such as tangible property or buildings, are transferred
- if any customers are being transferred
- if the businesses being transferred are notably similar in structure and function
- if the outgoing business processes were suspended for a period of time due to the transfer
For takeovers in which TUPE is guaranteed to apply, your chosen lawyer will be able to regulate it via a contract. It's possible for employees to opt out but this can result in the potential loss of valuable legal rights.
Employees have the legal right to transfer to their new employer on their pre-existing terms and conditions, with all their employment liabilities and rights in place. If any dismissal occurs directly as a result of the transfer it will be deemed automatically unfair.
The outgoing employer has a duty to inform and consult with staff. If this is not carried out to the necessary specifications then a complaint can be put forward to an employment tribunal. The old employer must also take care to provide the incoming employer with all liability information relating to employees.
Your Oratto member lawyer will be able to go through and thoroughly check any obligations that may exist, whether you are the incoming or outgoing employer.
Are there any situations where TUPE does not apply?
It's not possible to simply stop TUPE from applying to transfers, however, the old and new employers can divide the relevant obligations between them, normally through contracted indemnities. If the business is insolvent then TUPE can be relaxed to protect the new employer from existing liabilities towards giving notice, redundancy and associated payments.
Oratto - putting you in contact with expert advice on TUPE transfers for your business.