Susan Mitchener CIPD (Linkedin)
Head of Human Resources
TUPE stands for ‘Transfer of Undertaking, Protected Employment’. Put simply, an ‘undertaking’ means a business. The TUPE regulations came into force in 2006 and apply at the point where a business (or part of a business) changes hands. It also applies to a change of service provider. For TUPE to come into play the business has to retain its identity after the change, and the service provision has to remain the same in the first instance, together with an identifiable group of employees providing that service.
Protected employment in essence safeguards existing employees working for the business. TUPE ensures a seamless transfer of their employment to the new owner, together with their contract T&Cs and continuity of service. This is important in cases of employee redundancy and dismissal.
The transferring employer is bound by law to conduct a ‘full and meaningful’ consultation with the employees at the earliest opportunity. They’re also required to provide information on Employee Liability no less than 28 days before the transfer date.
There are some circumstances where an employer can vary the T&C’s of the transferring employees. These are for ‘Economical, Organisational or Technical reasons’, or if the employees are transferring to superior terms and conditions. Varying T&C’s should be treated carefully, as any dismissal that can be linked to a TUPE transfer would be considered automatically unfair by a tribunal.
Let’s take a look at how TUPE can be applied in the property industry. It would apply if a property management company won a contract to manage a property, and that property had on site staff currently employed by an existing managing agent. But if a landlord uses a managing agent to manage a block and an RTM Company takes over the management, the RTM Company does not ‘inherit’ the managing agent’s service provision. TUPE doesn’t apply because the client has changed, so the provision of service agreement is null and void.
TUPE is a very complex area of employment law, so it’s essential to seek advice relevant to the individual circumstance. The key to successful TUPE transfers lies in good planning, which will include identifying risks at an early stage.
Article by: Susan Mitchener (LinkedIn) Head of HR – VERTOHR