When a business or part of a business is transferred, employees will be transferred to the new owner as well. The rules surrounding this are complex. They are set out in the Transfer of Undertakings (Protection of Employment) Regulations 2006. It requires the new owner of the business to take on existing employees together with all of the rights, powers, duties and liabilities that they have.
This means that the new employer effectively steps into the role of the previous employer and can be sued by the employees if they have a valid claim, even if it is in respect of something done before the transfer. There is also a strict process of informing and consulting staff in respect of the transfer, which must be followed to avoid the risk of a claim being made to an employment tribunal. Where a failure to inform and consult is found, both the outgoing and incoming employers could face liability.
For these reasons, it is essential to take expert TUPE transfer advice from a specialist employment lawyer. At Stephen Rimmer Solicitors, our employment team have extensive knowledge of the rules and regulations surrounding business transfers and employer liabilities. We can carry out the necessary checks in respect of the employees you will be taking on and ensure that your interests are protected as far as possible by the inclusion of indemnities in the contract for sale.
We can also guide you through the correct informing and consultation process to ensure that your obligations are fully discharged.
How we can help with TUPE advice for employers
Our employment law experts can provide advice in respect of TUPE obligations for a full range of businesses. Our services include the following:
- Employers’ TUPE obligations
- Considering TUPE in relation to terms of business sales and purchase and drafting the necessary warranties and indemnities to protect you from liability as far as possible
- Notifying employees and employee representatives of a transfer
- Employee TUPE consultation processes
- Advising you in respect of the existing employment contracts and policies if you will be taking over a business
- Working with you to ensure that the correct procedure is followed throughout and that your rights and interests are protected
- Representing you during the transfer and dealing with any issues as they arise
- Advice in respect of associated matters such as pensions, contractual rights and redundancies
- TUPE dispute resolution
Consult our TUPE solicitors in Eastbourne and Hastings
For clear, expert TUPE advice, please contact a member of our employment law team for a no obligation discussion:
- Call: 01323 434416
- Email: firstname.lastname@example.org
- Or pay us a visit at 21 Lushington Road, Eastbourne BN21 4LG
For more information in respect of our services, see employment law for employers.
TUPE, the Transfer of Undertakings (Protection of Employment) Regulations 2006, protects the rights of employees when a business or service provision is transferred to a new owner.
It means that employees transfer to the new employer along with all of their rights, including the existing terms and conditions of their employment. Their continuity of service is also transferred.
The process starts with informing and consulting the employees as well as providing full employee liability information to the incoming employer. This should include details of the existing employment contracts, potential claims against the employer, grievances and previous legal and disciplinary actions.
Employees should be notified that the transfer is happening, including when, why and how it will affect them. They also need to be told if any reorganisation is planned and if any agency workers are being used.
The employer will take over all of the existing employment contracts. If the employee refuses to work for the new employer, this is generally seen as a resignation, and they would not usually be able to bring a claim for unfair dismissal or redundancy.
As well as the right to be informed and consulted about the transfer and any possible changes that might affect them, employees have the right to retain their existing contract terms and conditions, with no changes being made by reason of the transfer.
TUPE does not apply when the transfer is within the public sector. Additionally, it does not apply when a service that has been done in-house is outsourced to a contractor or when a contract ends.
Contracts for single events are not included in the TUPE Regulations, nor are contracts for the supply of goods.
It is not always straightforward to ascertain whether or not TUPE applies in respect of service provision changes, and it is recommended that employers take expert legal advice to ensure that their legal position is clear and that they are compliant with the rules.
Provided the correct process has been followed, an employee is unlikely to have a right to make a claim simply because their employer has changed following the sale of a business.
The protections offered by TUPE last indefinitely, meaning that even some years later, the new employer cannot make changes to an employment contract on the basis (or largely on the basis) of the transfer.
Employees’ salaries cannot be changed downwards under TUPE, where the main reason for reducing them is because of the transfer.
It is open to the new employer to increase salaries, for example, so that all employees are earning the same amount for the same jobs. However, this will still need to be agreed upon with the employees or their trade union representatives.
An employer will need to show that there is a genuine economic, technical or organisational reason to make an employee redundant after a transfer of a business. This could relate to business performance and profitability, the technology the business uses or the structure of the organisation.
The reason would also have to relate to changes in the new workforce. If you are considering making employees redundant following the purchase of a business, you should take legal advice before starting the redundancy process to ensure that you have valid grounds. If you do not, then a redundancy would be classed as automatically unfair, and the employee could make a claim against you.
As the new employer, if redundancy does go ahead, you would be liable to pay redundancy money for the whole of the employee’s period with the business.
Our TUPE advice for employers pricing
We know that keeping to a budget is important when you are dealing with the sale or purchase of a business. We always ensure that our prices are competitive, while providing excellent legal advice and outstanding client service.
For some work, we are able to offer fixed fees, meaning that you will know from the outset exactly how much our service will cost. For other work, we will let you know the hourly rates of the lawyers working on your case and an estimate of the likely time involved so that you have a realistic idea of the costs.
Speak to our TUPE solicitors in Eastbourne and Hastings
From our offices in Eastbourne and Hastings, our team advises employers all across East Sussex, including in Bexhill-on-Sea, Hailsham, Polegate, Battle, Pevensey and St Leonards-on-Sea.
To find out how we can help with TUPE advice for employers, please contact our expert team now:
How can we help you?
Call us today on 01323 644222 to get the specialist help you need.