TUPE Advice

If your business is undergoing a transition where all or some of it will be transferred to another owner, it is essential to understand TUPE—the Transfer of Undertakings (Protection of Employment).

When the regulations apply

Firstly, determine if the regulations are applicable. They will apply in scenarios such as:

· A section or the entirety of your business is transferring to a new owner, or you are merging with another entity.

· A service provision transfer occurs, meaning an internal service is outsourced, or an outsourced service becomes internal.

Potential challenges

At first glance, a transfer may appear straightforward, requiring the acceptance of all incoming employees' contracts along with their terms and conditions. However, this process can prove complex.

Unless the contracts of the incoming employees perfectly align with those of current employees, adjustments will be necessary. For instance, consider the variations in annual leave entitlements: current employees might have 28 days of paid leave per year plus bank holidays, whereas incoming employees could have 28 days of paid leave including bank holidays. While it might seem logical to standardise these terms for all employees, this approach is not legally permissible. Negotiation, effective communication, and thorough checks will be required to manage such changes appropriately.

Comprehensive considerations

Employers must meticulously assess numerous employment aspects under TUPE, including:

· Salary

· Annual leave entitlement

· Additional benefits

· Company cars

· Redundancies

· Employees on leave

· Remote workers

Given the breadth of these issues, it is understandable if some items are inadvertently overlooked. It is vital to approach the TUPE process methodically to avoid becoming overwhelmed. An error in contract terms can lead to significant consequences, differentiating between a successful transfer and a tribunal claim.