Change of Employer and TUPE

TUPE regulations mean that employee’s terms and conditions are preserved when a business is transferred to a new employer. It is a complex piece of legislation that we can provide specialist advice and guidance on.

An employee with a minimum of 2 years’ service is protected from dismissal whether before or after the transfer of a business. The only exception is where an employer can demonstrate that the dismissal is due to an economic, technical, or organisational reason (ETO), which involves a change to the workforce.

What Rights Does TUPE Give Me as an Employee?

TUPE protects your existing terms and conditions of employment, including your legal rights, when your employment transfers to a new employer. This transfer can happen for several reasons, such as:

  • The company is sold to a new owner. This includes business mergers (two companies combine to form a new company) and acquisitions (where one company takes over the business of another).
  • A service that was undertaken by your employer is awarded to a contractor.
  • A service contract ends with the service being taken in-house by the client.
  • A service contract is assigned to a new contractor during a retendering.

Under the TUPE regulations, employees of the outgoing employer become employees of the incoming employer at the point of the business transfer. They will continue with the same terms and conditions of their original employment and their continuous service should continue.

It is a requirement under TUPE that employees are consulted with by their current employer and the incoming employer to advise them of any anticipated changes that may take place after the transfer before it takes place.

Will TUPE Ensure My Employment Rights Are Not Affected?

After the transfer the new employer will review the contracts of employment. Changes to the contract are permitted where the employer seeks to standardise the contracts to prevent contract disparity. Changes may be permitted if there is provision in the current contact of employment for this to occur. Any changes should take place following a period of consultation as the employer may wish to match your contract of employment with those of their existing employees.

Harmonisation will generally mean that the change results in more favourable terms and conditions that you enjoyed at your previous employment. Some employers may offer other benefits that you do not currently enjoy as a means of encouraging you to agree to their change of contract.  In certain circumstances following a review of the business transferring employees may be subject to redundancies for and ETO reason. Where the right is not reserved to make changes in the contract the employer may carry out a dismissal and re-engage you on new terms and conditions.

Will TUPE Protect Me From Dismissal?

TUPE can also protect you from dismissal. If an employer is seeking to dismiss you after a transfer and the sole or main reason is due to the transfer of the business, you may have a claim for unfair dismissal. This is unless your employer can show an ETO reason for the dismissal requiring changes in the workforce.

If you are being asked to accept a new contract or facing dismissal following a transfer, we highly advise you seek specialist legal advice and speak to one of our experienced TUPE solicitors. This is an extremely complicated area of law that our team have vast knowledge of.

Is My Pension Protected Under TUPE?

The occupational pension scheme will not necessarily transfer to the new business owner. However, there are duties that are imposed under TUPE which requires that employees who were members of a pension before the transfer continue to have access to a pension scheme after the transfer.

If the ownership of the company you currently work for is about to change, you may be worried about your rights and the terms and conditions of your contract under your new employer. Our highly regarded and experienced employment team can advise you on all aspects of an employment transfer.

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