When an employer sells or transfers the business the provisions of the Transfer of Undertakings (Protection of Employment) Regulations (TUPE) 2006 apply in order to provide protection to existing employees of the organisation. In order to protect employees it is important that these obligations are complied with.
The effect of TUPE is to automatically transfer the employees and their existing contracts and rights to the new owner of the business.
If any employee is dismissed because of the transfer of the business that dismissal will be deemed to be unfair. If the dismissal was prior to the transfer of the business then liability will rest with the previous owner. If it was after the transfer liability will attach to the new owner.
TUPE is applied in two situations
- Where there is a transfer of the business in whole or in part; and
- Where there is a service provision change. This arises where the provider of the service changes. For example an employer might start placing work with and outside contractor (outsourcing) or bringing that work back in house (insourcing) or reassigning that work from one contractor to another.
Further, if an employer is about to transfer the business he has an obligation to inform employees of the transfer. This obligation is strict. Employees must be notified not only of the transfer of the business but also:-
- The date of the transfer
- The reason for it
- The legal, social and economic impact on the employees; and
- How the existing employer and the incoming employer will deal with those affected.
Information must be provided to and consultation made with trade union representatives or, if there are none, with employee representatives. If there are no such representatives the employer must inform each employee individual there are particular rules for companies with fewer than 10 employees.
If you are in this situation we can advise you as to your entitlements and help you bring a claim if you have been treated unfairly.
For an initial discussion about how we can assist you organisation it address any of the above an other employment law issues, please contact any of our offices or send us a message using the contact form on the right of this page and we will get back to you as soon as possible.
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