What is TUPE?
It is an acronym that stands for the Transfer of Undertakings (Protection of Employment) Regulations 2006 as amended by the Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 2014.
You can see why people just use TUPE instead.
What Does it Do?
The TUPE rules apply to organisations of all sizes and protect employees’ rights when the organisation or service they work for transfers to a new employer. A person’s terms and conditions of employment are preserved upon transfer to the new owner or employer. No business is exempt from TUPE whatever their size.
When Does this Happen?
There are two situations when TUPE will usually apply.
- A business transfer – put simply when the whole or part of a business changes hands; and
- Service provision change – where there is a change of employer providing a service e.g. cleaning services or rubbish collection.
There are special rules where the business concerned is insolvent (administration or liquidation).
Therefore, as an employer, whenever you decide to buy or sell all or part of a business or a service you should be asking yourself the following questions:
- Does TUPE apply to this transaction?
- And if it does what do I need to do?
Big Question why should I be bothered about this???
Answer – get it wrong or ignore it at your peril as both the buyer and seller can be sued by employees affected by TUPE.
If an employee feels that the transfer of the service or part of the business they work for has treated them unlawfully/unfairly they can apply to an Employment Tribunal citing both the new and old employer as being in breach of TUPE and let the Tribunal decide if one or other is at fault or both are.
This a situation best avoided as an employer or employers can be held liable for the following awards of compensation:
- Automatically unfair dismissal claim – up to £83,682 or 52 weeks pay (the lesser applying).
- A failure to inform and consult with employees – up to 13 weeks for each employee affected.
- Failure to provide employee liability information – £500
- The cost of defending a claim in Tribunal – an average of £8,500 (British Chambers of Commerce 2017) with little or no chance of getting this back even if the employer is proven to be right.
Would you Like to Know What to do & How to Avoid TUPE’s Pitfalls?
Then give us a call on 01527 571617, email our HR Team or fill in the form below.