What Is A TUPE Transfer And What Should Employers Be Aware Of?

by Tim Bishop on March 18, 2014

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TUPE stands for the Transfer of Undertakings (Protection of Employment) Regulations, something which was first passed back in 1981. This legislation is used in the UK in order to implement the European Acquired Rights Directive, and can be a complex and confusing process to many. It is basically put in place to protect the rights of employees during a business transfer, but what does it mean for employers? What should you be aware of when going through a TUPE transfer? Here’s a brief guide.

When Is A TUPE Transfer Relevant?

Not all business transfers will need to go through the TUPE transfer process; the regulations only refer to business takeovers where there is a transfer of an economic entity that retains its identity. This means that the type of business conducted will be the same after the transfer, there may be a transfer of tangible assets (such as buildings), the majority – if not all – of employees will be taken over, the customer base will be transferred, and so on. If there isn’t any similarity in the activities carried out by the business before and after the transfer, TUPE probably won’t apply, but you will need to seek the advice of a lawyer to be certain.

What Does A TUPE Transfer Actually Involve?

When going through a TUPE transfer, the new owner of the business agrees to take over all existing employees’ contracts, including all previous terms and conditions, their holiday entitlement, all previous collective agreements, and the period of continuous employment (for example, their start date remains the same even after the transfer has taken place). After the transfer has occurred, you should give all employees a written statement of employment that is completely up to date, including the information of the new employer. This reassures employees that their terms and conditions haven’t changed. You may also need to give employees a P45 if their tax information needs to be updated.

What Other Things Should You Be Aware Of Regarding TUPE?

Just as all of the employees’ rights and terms are carried over to the new owner of the business, so too are any complaints or claims made against the business owner, even if the event occurred before the transfer. It should also be noted that some employees may not want to work for the new owner, in which case they can resign as usual (there generally won’t be any redundancy pay or unfair dismissal claims in cases such as these, unless working conditions have deteriorated considerably since the transfer). You should be aware that notice, however, isn’t required, so as long as the employee has told their employer of their intention to resign before the transfer happens, they will be able to leave at the time of the transfer without having to work any notice period.

Seeking Help To Guide You Through The TUPE Transfer Process

Any business seeking a new owner – and any employer looking to take over an existing company – should seek professional advice from an expert solicitor. A specialist law firm will be able to advise you on whether or not TUPE applies and then help guide you through the transfer process from start to finish. There are a number of solicitors specialising in this area of business so get searching for a firm today.

Tim Bishop is senior partner of Bonallack and Bishop – UK Solicitors with a team of employment law and TUPE experts. For more information about TUPE Transfers, visit their specialist website http://tupe-transfers.co.uk or call them directly on [01722] 422300.

Tim Bishop
Having qualified as a Solicitor in 1986, Tim Bishop is a legal entrepreneur who owns law firm Bonallack & Bishop. Find out why you should choose the commercial solicitors at Bonallack & Bishop: Visit www.bishopslaw.co.uk.
Tim Bishop

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