TUPE transfers
The Allan McDougall Solicitors employment law team has many years of expertise regarding TUPE transfers. With experience across multiple industries, we work on behalf of employees in Scotland and have done so for years.
From what TUPE is, to when it applies, what your rights are as an employee and more, our understanding of this aspect of employment law helps us to achieve a fair and legal result for our clients.
What is TUPE?
The Transfer of Undertaking (Protection of Employment) Regulations of 2006 is a piece of legislation that secures your contract as an employee if your employer’s business changes or transfers to another owner.
Under TUPE, employees should be transferred to the new employer under the same conditions as their original contract of employment. This includes keeping all existing contractual employment rights and liabilities.
When does TUPE apply?
TUPE applies when there’s a relevant business transfer to another person or company. Relevant transfer refers to business transfers and/or a service provision change.
Used to protect employee rights under their contract of employment, TUPE can apply in the following situations:
- When a company acquires all or part of another company.
- When two companies become one through a merger.
- When a new contractor assumes responsibility for activities previously handled by another contractor.
- When a client takes over operations previously managed by a contractor (insourcing).
- When a contractor takes over operations previously handled by the client (outsourcing).
TUPE does not apply when shares, assets only, or the supply of goods are transferred. It also won’t apply if a contract to provide services or goods is transferred which doesn’t include the transfer of the business or part of it.
What does TUPE cover?
In the case of a relevant business transfer, TUPE ensures your contract of employment automatically transfers to the new business owner. It means your contract is treated as though it was originally agreed upon with your new employer, rather than the original.
Here’s a list of rights that are transferred under TUPE:
- All existing contractual terms
- Contractual holiday entitlement
- Contractual redundancy payments and notice payments
- Your length of service
- Employer benefits such as health insurance or private medical insurance.
- Indemnity under your employer’s liability insurance.
There are some contractual rights that do not transfer. For instance, occupational pension scheme rights do not transfer, though the new employer will still be obliged to provide for a pension which meets the minimum legal requirements.
Previously held share options may be lost with a business transfer, but you may be entitled to be compensated for the loss of these.
Can you be dismissed because of a business transfer?
If the sole or principal reason your dismissal is the transfer, the dismissal will be deemed automatically unfair. However, this only applies if you have two years of continuous service.
One way around this for employers is if they show that the dismissal was for an economic, technical, or organisation (ETO) reason that requires a change in the workforce. The ETO defence only applies if the transfer means the business workforce and job roles will change significantly. This will generally apply in cases of legitimate redundancy requiring restructuring or business reorganisation.
If you’re dismissed before a business transfer, liability will pass to the new employer unless there’s a valid ETO defence.
What employers should do
Before any business transfer where TUPE applies, the employer should inform and consult appropriate representatives about the change.
If there is a recognised trade union, the appropriate representatives will be representatives of that trade union. If there is no recognised trade union, the employer should inform and consult with employee representatives. If there are no employee representatives, the employer should facilitate an election process to choose representatives.
Employers should provide information about the date and reason for the business transfer and the economic, social, and legal implications for affected employees.
If the employer doesn’t follow the procedures of a TUPE transfer, employees may be able to claim compensation of up to 13 weeks’ pay in an employment tribunal. Your original and new employer will either be jointly liable for this compensation or one of them will be solely liable.
How we can help
Our experience in employment law means we can help you navigate the complexities of TUPE transfers at work. We can guide you to achieve a fair and legal outcome from any TUPE transfer, providing advice around the process and help in cases of unfair dismissal arising from a business transfer.
Get in touch with Allan McDougall Solicitors
If your employer is planning a business transfer as listed above, don’t hesitate to get in touch with the employment law experts at Allan McDougall Solicitors.
Contact us
- Email us
- Call free on 0808 560 0872
- Arrange a callback by using our enquiry form
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