Business Transfers and the TUPE Regulations

The Transfer of Undertakings (Protection of Employment Regulations) 2006 are commonly known as the ‘TUPE Regulations’.

These regulations operate to transfer employees from one business to another.

This can happen in two situations.

First, where an organisation, or part of an organisation, is transferred from one business to another business.

Secondly, where there is a ‘service provision change’. This can be where a company decides to outsource work that was formerly done inhouse. For example, engaging an external cleaning contractor. It can also be where there is a subsequent change of contractor (such moving the cleaning contract from one outsourced provider to another). Or, it can be where the service is brought back ‘in-house’.

When TUPE applies, employment contracts transfer automatically.

The TUPE regulations impose onerous obligations on your business, including employees gaining enhanced protection against dismissal.

You are obliged to inform and consult about the transfer. A failure to properly do so can lead to an Employment Tribunal awarding each employee up to 13 weeks’ pay.

If your employees are transferring to another business, then you’re obliged to provide that business with information about your employees. If the correct information is not provided, then an Employment Tribunal has the power to award a minimum of £500 compensation for each employee.

If you are transferring or receiving employees, then it is important to take early advice upon your obligations. We shall take the time to really get to know your business and consider the risks that might apply to the TUPE transfer. We shall provide pragmatic advice on the best way forward and upon your obligations.