Revised TUPE Regulations
The revised Transfer of Undertakings (Protection of Employment) Regulations comes into force on 31 January 2014.
What are the TUPE Regulations for?
The TUPE Regulations are intended to ensure that the transfer of work from one employer to another is done fairly and efficiently. The Regulations provide employment rights to employees when their employer changes as a result of a transfer of an undertaking when, for example, employees are moved to work in a new business following a buyout. TUPE is a complex area of law but, in general terms, the TUPE regulations apply when:
• A business or undertaking, or part of a business or undertaking, is transferred to a new employer; or
• When there is a ‘service provision change’ e.g. a contractor takes on a contract to provide a service from another contractor.
The TUPE Regulations are there to preserve the continuity of employment and terms and conditions of the employees who are transferred to a new employer when a transfer (see two points above) takes place. The Regulations provide for a limited opportunity for the previous employer (the transferor) or the new employer (the transferee) to vary terms and conditions of employment contracts in certain stipulated circumstances.
What are the changes?
Although it was initially suggested that the 2014 changes would be wide-ranging in scope, the changes that are actually being introduced in January 2014 are being seen as minor adjustments to the existing arrangements. In particular, the proposal to repeal the service provision change did not progress beyond the consultation stage.
The changes to the TUPE Regulations coming into force as of 31 January 2014 are intended to simplify TUPE and are as follows:
• The new employer will be able to re-negotiate terms and conditions provided for in collective agreements (between trade unions and the employer) one year after the transfer, provided that overall the change is no less favourable to the employee;
• Only collective agreements in place at the time of transfer will apply to the new employer;
• The meaning of ‘entailing changes in the workplace’ will be amended to cover changes in the location of the workforce so some TUPE dismissals involving a place of work redundancy will not be automatically unfair;
• Micro-businesses (with ten or fewer employees) will be allowed to inform and consult directly with affected employees where there is no recognised trade union or existing appropriate employee representatives;
• The transferor will be required to provide employee liability information to the transferee 28 days before the transfer (rather than 14 days as at present);
• The wording of the provisions restricting changes of contracts, giving protection against dismissal and concerning a substantial change in working conditions to the material detriment of the employee will be changed so they reflect more closely the wording of the EU Acquired Right Directive; and
• Where the transferee is proposing 20 or more redundancies after the transfer, collective redundancy consultation that takes place before the transfer will, in some cases, count for the purposes of the rules on collective redundancy consultation.
Full details of the changes to the TUPE Regulations can be found on the government website: www.gov.uk.
If employers believe that the TUPE Regulations may apply, it is strongly recommended that legal advice is sought.
The TUPE documents on the Simply-Docs site are not affected by these changes to the Regulations and may still be used. New TUPE documents will be added to Simply-docs over the next few weeks.
The contents of this Newsletter are for reference purposes only and do not constitute legal advice. Independent legal advice should be sought in relation to any specific legal matter.