4. Consultation and collective rights

Workplace representatives have the right to be informed about a transfer before it takes place. They are also entitled to be consulted if changes are envisaged as a result of the transfer. This Chapter explains:

• the law on information and consultation (I&C) under TUPE;

• what action reps can take if the employer breaches TUPE I&C obligations;

• the legal effects of a transfer on collective employment rights; and

• the employer’s duty to disclose “employee liability information” to the transferee to help prepare for the transferred employees.

The right to information and consultation

Employees can only be properly protected in the event of a transfer if they know what is happening and can have input into decisions about their future employment. Broadly speaking, TUPE says that all employees who could be affected by a change of employer have the right to be informed in advance of what is happening. This includes both employees working for the old employer (the transferor) and those working for the new employer (the transferee).

The aim of the I&C process under TUPE is to provide enough information, in enough time, to enable genuine consultation to take place. In most cases, consultation is carried out between the employer and the representatives of the employees who are going to be affected by the changes.

The legal requirements governing I&C can be found in Regulations 13 and 14 of the TUPE Regulations 2006.

The Regulations only cover “affected employees”. However, good industrial practice should extend consultation to all workers, including agency workers and the self-employed. As noted in Chapter 3, migrant workers, in particular, will be impacted by a TUPE transfer, under the new points-based immigration system.

Employers’ duty to inform representatives

Before a relevant transfer takes place, employers have a duty to inform the appropriate representatives (see below) of the following factual issues (listed in Regulation 13(2)):

• the fact that there is to be a transfer, and the reasons why;

• the date or proposed date of the transfer;

• the likely legal, economic and social consequences of the transfer for affected employees;

• what measures are likely to be taken in relation to affected employees;

• if no measures are to be taken, confirmation that this is the case; and

• what measures will be taken by the new employer or, if none are envisaged, confirmation that this is the case.

Does the duty to inform arise even if there is no duty to consult?

The duty to inform arises on every transfer. The duty to inform exists independently of any statutory duty to consult, which is only triggered when “measures” are envisaged (see below). One function of the duty to inform is to make sure that if, as often happens in practice, an employer chooses to engage in voluntary consultation, reps are given all necessary information to make sure any voluntary consultation is genuine and meaningful. (IPCS v Secretary of State for Defence [1987] IRLR 373, confirmed in Cable Realisations Limited v GMB Northern (UKEAT/0538/08).

When must the information be provided?

The employer must provide this information long enough in advance of the transfer to allow for genuine consultation to take place. It must be delivered to each representative, or sent by post to them and must be good enough to enable representatives to perform their duties.

Consultation timescales

At the risk of stating the obvious, TUPE imposes a duty to inform and consult employees before the transfer takes place. Any consultation that takes place after the transfer date will not help an employer to persuade the tribunal that it has complied with its statutory I&C duty under TUPE (UCATT v Glasgow City Council [2008] UKEAT 0007/08/1911). However, as a matter of good practice, there should be on-going workforce consultation before and after the transfer. In any event, there will need to be separate collective redundancy consultation after the transfer under the Trade Union and Labour Relations (Consolidation) Act (TULRCA) 1992 wherever the new employer plans to make collective redundancies from the combined workforce.

For consultation to be meaningful, tribunals expect employers to engage in the I&C process as early as practically possible. The 2007 case of UK Coal Mining v NUM (UKEAT/0141/07/RN) is a helpful illustration of the potential breadth and strength of consultation obligations. In this important case, which concerned TULRCA consultation over collective redundancies following the decision to close a pit, the EAT confirmed that the employer was obliged to consult on the underlying economic justification for the pit closure, as well as on the redundancies themselves.

Another important recent decision on the timing of consultation is United States of America v Nolan ([2010] EWCA Civ 1223). In this case, the US Army was considering the closure of its base at Hythe in Hampshire from early 2004. In early 2006, an audit of the base was carried out. Although the resulting report made it clear that a decision had already been taken to cease operations at the base, the civilian workforce were not formally told about the closure until after the press had got hold of the story.

Both the tribunal and the EAT agreed that redundancy consultation should have commenced earlier — when the possibility of closing the base was first considered, and not after the decision had been taken. However, the Court of Appeal was less sure, noting a recent ambiguous decision of the ECJ in Akavan Erityisalojen Keskusliitto AEK ry v Fujitsu Siemens Computers Oy, Case 44/08, concerning Fujitsu’s decision to make redundancies. Because of this lack of clarity, the Court of Appeal has referred the issue to the ECJ. The ECJ is likely to rule by the end of 2011.

In the meantime, reps should be pressing the position that only early consultation as to whether a particular decision should be made (in line with the UK Coal Mining case) as opposed to the more limited consultation as to how a decision already taken by management, should be implemented, can be genuine and meaningful consultation.

Unlike the law on collective redundancies, TUPE does not set down a specific deadline by which consultation must have begun. The only requirement is that consultation takes place “long enough before a relevant transfer” to enable consultation to take place.

The case of Cable Realisations Limited v GMB Northern (UKEAT/0538/08) offers some guidance. Information was given to the union on 15 August, two days before the factory closed for its annual shutdown until 31 August. The transfer took place on 3 September. There were no “measures” envisaged, so no obligation to consult was triggered. The EAT concluded that the holiday shut-down made it impossible for the information to be used by reps, either with management or with their own members. As a result, the information had not been given long enough before the transfer date to enable “meaningful consultation” to take place.

The mechanics of the duty to consult reps

As indicated above, the employer’s statutory duty to “consult” as opposed to simply “informing” representatives is triggered whenever it is “envisaged” that “measures” will be taken in relation to an “affected employee” as a result of the transfer. (For a discussion of what is meant by “measures” in this context, see below.) The employer must consider any representations made by the workforce and reply to them, giving reasons for objection where appropriate.

The duty is to inform and consult “representatives”. The appropriate representatives for TUPE purposes are defined in Regulation 13(3). If there is a recognised trade union for affected employees, the TUPE rep role will be taken by the union reps.

Where there is no recognised union, representatives can be either:

• representatives of affected employees who have been appointed or elected generally for I&C purposes (i.e. a standing non-union consultation body), where one exists. (An employer consulting with non-union reps under this Regulation would need to be absolutely confident the reps had a proper mandate to represent all affected employees, in relation to all the issues connected with the transfer); or

• employee reps elected by affected employees to engage in TUPE consultation in relation to this particular transfer.

In other words, where there is a recognised union, the employer must inform and consult with union reps.

Is there a minimum number of employees who must be “affected” before the I&C obligation is triggered?

No. Unlike collective redundancy consultation, there is no minimum number of affected employees for the I&C obligations under TUPE to be triggered. TUPE I&C obligations are triggered even if only one person’s job is transferred. The size of the business (transferor and transferee) is also irrelevant.

What is the process for electing representatives under TUPE?

Where there is no recognised trade union and no standing non-union employee consultation body, the employer must invite affected employees to hold elections to select representatives. Failing to offer to carry out an election is one of the most frequent TUPE-related mistakes made by non-unionised employers, especially smaller employers. Regulation 14 lays down the rules for elections. The employer:

• has to make “reasonably practicable” arrangements to ensure the election is fair;

• decides how many representatives there should be. There must be “sufficient” reps to represent the interests of all affected employees;

• can decide whether or not different classes of employee have their own representatives;

• decides on their length of office, which must be “sufficient” for the information and consultation process to take place;

• only “affected” employees can stand for election and no affected employees can be unreasonably excluded;

• all affected employees have the right to vote, either by class of representative or for the full list;

• individuals must have the opportunity to vote in secret, with the votes being accurately counted; and

• facilities must be in place to enable votes to be accurately counted.

As long as the employer has invited affected employees to elect representatives, if they do not do this within a reasonable period of time, the employer is not in breach of its duty to consult. However, if there is no elected representative, the employer must give the statutory information listed above directly to the affected employees (Howard v Millrise Ltd & S G Printers t/a Colourflow UKEAT/0658/04 ([2005] IRLR 84). If “measures” are envisaged, the employer must then consult directly with individual employees.

Facilities and time off

Regulation 13(8) sets out the minimum facilities the employer must provide for representatives. These are:

• access to the affected employees; and

• such accommodation and other facilities as may be appropriate.

Where there is a recognised union, the employer must provide appropriate facilities for trade union reps to carry out union duties. Union officials are entitled to paid time off for carrying out union duties in relation to TUPE, under section 168(1)(c) of TULRCA 1992.

The Acas Code of Practice on time off for trade union duties and activities recommends that facilities should include arrangements for accommodation and equipment. Appropriate facilities might include an office, telephone, fax and computer with email and internet access. The larger the employer, the more facilities reps might legitimately expect. For more information about facility time, refer to the LRD booklet Time off for trade union duties and activities — a legal guide.

The Acas Code of Practice says reps should have reasonable time off to:

• prepare for negotiations and for consultation

• inform members of progress; and

• explain outcomes to members.

For consultation over TUPE, employers would be expected to give trade union reps time off, for example, to consult with members and to meet to decide their response to the information provided by the employer. Reps should also insist on the right to meet with reps from the workplace to which work is being transferred, providing the opportunity to compare notes and to put together a strategy offering the best level of job protection to both sets of workers.

Reps should also argue for TUPE consultation rights that are at least as good as those recommended by the Acas Code of Practice.

What is meant by “measures”

The employer has a duty to consult when it “envisages” it will take “measures” in relation to affected employees in connection with the transfer.

Although there is no definition in the Regulations, there has been important new case law on what is meant by “measures”. In Todd v Strain and others (UKEATS/0057/10/BI), the EAT confirmed that measures “is a word of the widest import, which includes any action, step or arrangement…deliberately done by the transferor” over and above what necessarily happens as a result of the transfer itself.

Ms Todd owned a care home which transferred to Care Concern Limited. A couple of months before the transfer, she called a meeting of staff to tell them of the sale and to confirm that their jobs were safe. She then provided periodic updates, but she did not provide information to, or engage in consultation with staff reps, or give detailed information to staff.

The EAT found that Ms Todd had failed in her duty to inform or consult on three “measures” she envisaged taking in connection with the transfer, namely:

• early payment of staff wages;

• payment arrangements for untaken holiday; and

• information about a tax rebate for some staff.

These were all “measures” taken by Ms Todd to put the books in order before the transfer. The EAT confirmed that Ms Todd was obliged to consult with representatives about these measures. The fact that a new entity would be responsible for wages post-transfer was not a “measure”, because it was an inevitable consequence of the transfer. However, changes to arrangements for the normal payment date, or for payment of holidays were not inevitable. This meant they were “measures” calling for consultation.

The fact that measures are “advantageous” to employees is irrelevant to the question whether the duty to consult is triggered. In this case, for example, early payment benefited employees, who were unlikely to object in consultation. This makes no difference to the duty to consult, which is about ensuring employees have the fullest possible picture of how the transfer impacts on their employment, good and bad.

Ms Todd was ordered to pay seven weeks’ pay for each affected employee. Care Concern was made jointly liable to pay the compensation, even though it was not at fault.

In Nationwide v Benn [2010] (UKEAT0273), the EAT considered whether “job mapping” (the process of attempting to “map out” and then compare the duties attaching to different posts in the two employers) was a measure. Although the tribunal did not need to decide the issue, they rejected the employer’s suggestion that “job mapping” is not a “measure” because it involves projections about manpower, rather than positive steps to achieve manpower reduction.

As to consultation in relation to planned collective redundancies resulting from the transfer, see in particular the discussion of UCATT v Glasgow City Council ([2008] UKEAT/7/08) below, and Chapter 6 — Unfair dismissal rights).

What if the employer makes a mistake when engaging in the duty to inform or consult?

The employer’s duty is to consult on the position as it genuinely believes it to be. The employer does not promise to employees that its interpretation of the effects of TUPE is the right one. In Royal Mail Group v CWU ([2009] EWCA Civ 1045), the Court of Appeal accepted that Royal Mail genuinely believed, on the basis of legal advice, that TUPE did not apply to the transfer of a number of post-office branches to WH Smiths, because of contractual arrangements with employees enabling it to offer redeployment or redundancy. Royal Mail consulted on this basis with the CWU. Royal Mail’s interpretation of TUPE turned out to be mistaken. Even so, the Court of Appeal held that the employer had met its statutory obligation to consult, because it consulted on the basis of its genuine understanding of the legal position, however flawed.

However, it seems unlikely that this “get out” would help an employer who fails to provide any information or engage in any consultation at all until after the transfer date has passed, as a result of failing to recognise even the possibility that TUPE might have been triggered.

Who are the “affected employees”?

To ensure effective consultation, employers should take a broad approach when deciding who to consult, including not just those who transfer but also all those (in either organisation) whose jobs might be affected, for example through increased workload or changed duties.

According to government TUPE guidance, “affected employees” might include:

• those individuals who are to be transferred;

• colleagues in the transferor employer who will not transfer but whose jobs might be affected by the transfer; and

• new colleagues in employment with the new employer whose jobs might be affected by the transfer.

There has been important new case law on the meaning of “affected employees”. In UNISON v Somerset County Council ([2009] KEAT/43/09), two Somerset councils decided to transfer administrative functions to a new joint venture company to be run by IBM and 850 employees were directly affected. Two years of consultation followed. All employees except one opted to be seconded to the joint venture.

Late in the consultation process, a dispute arose between UNISON and the Councils over proposals for future recruitment into the joint venture. UNISON wanted a three-stage application process for new vacancies, recruiting firstly from amongst seconded employees, secondly from other council employees and thirdly via external recruitment.

IBM rejected this proposal. They were willing to recruit firstly from amongst the seconded employees. However, if that pool contained no suitable candidates, they wanted to be able to recruit straight from the private sector, without first advertising the job to existing council employees. UNISON argued that “affected employees” included not only directly affected employees, but also all other council employees who might wish to transfer into the joint venture in the future. The EAT rejected this wide interpretation and decided that “affected employees” are confined to:

“Those who will be or may be transferred, or whose jobs are in jeopardy by reason of the proposed transfer, or who have job applications within the organisation pending at the time of transfer. We do not think that the definition extends to the whole of the workforce, nor to everyone in the workforce who might apply for a vacancy in the part transferred at some point in the future”.

Consultation must be “with a view to seeking agreement” with the representatives.

Does the duty to inform and consult extend to situations involving outsourcing beyond the UK?

It is now well-established that TUPE can apply to transnational transfers, both within and outside the EU, as long as the transferred business is “situated immediately before the transfer in the UK” (Hollis Metal Industries Limited v GMB [2007] UKEAT/171/07). In this case, the business of Hollis, a curtain rail manufacturer, was transferred from England to Israel. The Court concluded that the Acquired Rights Directive covers transfers to countries outside the European Union.

The Court acknowledged that most individual employment rights could not, in practice, be enforced against an overseas business. Nevertheless, the Hollis decision is important because it confirms that the duty to inform and consult reps is triggered by an outsourcing that takes jobs out of the UK. Both the UK transferor and the foreign transferee will be jointly liable for financial penalties for failure to consult. This will mean that employees can claim the full amount of any penalty from the UK-based transferor, thereby overcoming the potential practical problems involved in enforcing Court judgments outside the EU.

Do the transferor and the transferee have a statutory duty to consult with each others’ workforce before the transfer?

Surprisingly, no. This was the result of UCATT v Glasgow City Council ([2008] UKEAT/7/08). The statutory duty requires the employer of the transferring employees to consult with its own employees and the transferee employer to consult with its own employees, in each case before the transfer takes place. However, according to the EAT in the UCATT case, TUPE does not impose a duty on the new employer to consult with the transferor’s workforce before the transfer. And the transferee does not owe a duty under TUPE to consult with the new combined workforce, made up of transferred and existing employees, following the transfer, on measures to be taken in connection with their employment by the new organisation. Obviously if those measures might lead to collective redundancies, the usual collective redundancy consultation obligations (including liability for a protective award) are triggered under the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA 1992).

The basis for the EAT’s decision in the UCATT case is that the obligation under TUPE is to consult employees before the transfer and not after, because the purpose of I&C is to enable employees to decide their reaction to a proposed transfer (including their right to object to the transfer) before it takes place. “Post-transfer” protection is supposed to be provided instead by the Regulations preserving terms and conditions (see below Chapter 5).

As a matter of good industrial practice, most large employers will engage in joint consultation with both sets of workers, before and after the transfer.

What are the penalties for failing to inform and/or consult under TUPE?

If an employer fails to comply with its I&C obligations, the affected employees’ representatives (or in some limited circumstances, the individual employee(s)) can bring a claim in an Employment Tribunal.

Who can bring the claim?

The claim can be brought by an individual affected employee where:

• the claim relates to failure to elect representatives; or

• there are no employee representatives

If there are trade union or employee representatives, the claim must be brought by the relevant representative(s).

In Northgate HR Limited v Mersey (UKEAT/0446/06/DM), the tribunal confirmed that where there are reps in place, whether union or non-union, an individual employee is not allowed to bring a claim for breach of the statutory I&C duty. Mr Mersey argued unsuccessfully that the “employee consultation council” installed by his employer as a standing non-union employee consultation body did not have the same independence as a trade union, and that in order for him to be genuinely protected, he should be allowed to enforce the remedy provisions as an individual.

In rejecting his argument, the Court of Appeal confirmed that these provisions are primarily intended to deal with complaints about collective issues not individual ones. An individual with a complaint should bring it through his representative, and a tribunal should make “no value judgments” as to the independence or otherwise of non-union verses union reps.

Northgate v Mercy involved an application under section 189(1)(b) of TULRCA 1992 for a protective award (collective redundancy consultation). However, this provision mirrors the relevant provisions of TUPE, and in Nationwide Building Society v Benn and Others ([2010] UKEAT0273) the EAT confirmed that the conclusion in Northgate applies equally to consultation under TUPE. (See also Martello Professional Risks Limited v Barnes (EAT/0121/09).

Who is liable for a failure to inform and/or consult

As explained above, the duty to inform or consult before the transfer is owed by each employer to its own workforce (UCATT v Glasgow City Council [2008] UKEAT/7/08). However, since 2006, liability for that failure is owed by both the transferor and the transferee jointly. As a result, any employment tribunal claim for failure to inform and consult will usually be brought against both transferor and transferee. This provision is especially helpful where there might be doubts over the solvency of one of the parties, or where (as in the Hollis case above) the transferee is situated outside the UK, making enforcement difficult.

In one particular situation, the transferee is solely liable for the transferor’s failure to inform transferring employees, namely where that failure is as a result of the transferee’s failure to pass to the transferor information needed in order to be able to inform employees properly.

What defences are available

The employer will only have a defence for a failure to provide information or to consult if it can point to “special circumstances” that made it “not reasonably practicable” to perform the particular duty, and provided the employer can show it took all steps that were reasonably practicable in those circumstances (UCATT v H Rooke & Son Limited [1978] IRLR204). This provision is normally very narrowly interpreted by tribunals. To qualify, “special circumstances” ought to be something unforeseen or unexpected, out of the ordinary run of commercial or financial events.

As a policy approach, tribunals are generally reluctant to be seen to condone a failure to consult, and this means that they tend to be reluctant to excuse employer behaviour via the “special circumstances” defence. Instead, tribunals are much more likely to make a finding that the employer has failed in its duty to inform or consult, but to reflect its view as to the seriousness or otherwise of that failure in the size of the award payable. The size of awards is looked at below.

However, in a troubling decision, UNISON v Somerset County Council ([2009] UKEAT 0043), the EAT decided not to interfere with the tribunal’s conclusion that following two years of “exemplary” consultation, poor consultation at the very end of the negotiating process could be excused using the “special circumstances” defence because of “fast-moving events”, an “approaching deadline”, and pressured negotiations. On the evidence before the tribunal, the transferee was found to be “seeking to unpick the whole agreement which would have had disastrous consequences”. Although each case turns on its own facts, “fast-moving events” and “pressure” are a feature of most commercial negotiations, and this case must not be used to suggest a precedent for watering down the “special circumstances” test.

The time limit for a claim

The claim must be issued in the employment tribunal within three months of the transfer date. The tribunal has a discretion to extend this deadline but it will very rarely be exercised. A tribunal might exercise its discretion to extend time in circumstances where the deadline passes because employees were unaware, for bona fide reasons, that a transfer had taken place.

What compensation can be awarded?

If the tribunal finds a failure to inform or consult, it must make a declaration to that effect and it can award “appropriate” compensation “to such descriptions of affected employees as may be specified in the award” (Regulations 15(7) and (8)). In other words, the award is not restricted to the individual(s) who have brought the claim. Instead, the tribunal can extend it to “affected employees” of any “description”, where the employer has failed in its duty to inform or consult those employees. There is very little case law about what is meant by “description”.

The maximum amount of compensation for a failure to inform or consult is 13 weeks’ pay.

Note that a “week’s pay” is not subject to the statutory cap imposed by the Employment Rights Act 1996 (£400 from 1 February 2011). This, combined with the scope for the award to cover all “affected employees”, means that awards for failure to inform or consult under TUPE can be very large indeed.

Compensation for failure to inform or consult under TUPE is supposed to be “penal”, in other words, it is meant to punish the employer. When working out the size of the penalty, the focus should therefore be on punishing the employer for failing to consult, as opposed to calculating what loss, if any, the failure to consult has caused to the employees. (Sweetin v Coral Racing EATS/0039/05 [2006] IRLR 252).

Tribunals are expected to follow the same approach as they adopt when calculating a protective award for a failure to consult over collective redundancies (Susie Radin Ltd v GMB & others [2004] EWCA Civ 180 ([2004] IRLR 400)). Since the award’s purpose is to punish the employer, it should reflect the seriousness of the employer’s failure. The correct approach for a tribunal is to start with the maximum award of 13 weeks, and then to reduce it, to take into account any mitigating factors.

There has in the past been a suggestion that the maximum 13 weeks’ pay will only be awarded where there is a failure both to inform and consult. The EAT in Cable Realisations Limited v GMB Northern (UKEAT/0538/08) confirmed that this approach is incorrect and that the full 13 weeks can be awarded for a failure of either duty. In that case, the tribunal’s award of three weeks’ pay per affected employee was upheld.

What if the employer is insolvent?

Because the purpose of a protective award is to punish the employer, it will be awarded even if the employer is insolvent. Where a protective award is made against an insolvent employer, employees can normally apply to the Secretary of State for payment out of the National Insurance Fund. However, since any payment out of the Fund will be subject to a maximum cap of eight weeks’ pay, and (unlike awards against solvent companies) will be subject to the statutory cap on a week’s pay, the protective award is sometimes pursued instead as a debt in the liquidation.

Can claims for a protective award be compromised?

It is not possible to use a compromise agreement to settle a claim for a protective award for failure to inform or consult. Only a COT3 settlement agreement entered into through conciliation by Acas can settle this sort of claim.

What if the employer fails to pay the compensation awarded by the Tribunal?

If the tribunal makes a compensation order and the employer fails to pay it, any of the “affected” employees (as opposed to the representative) can bring a claim for their portion of the amount owed. The claim must be brought within three months of the compensation order.

Duty to provide employee liability information

The TUPE 2006 Regulations introduced an obligation for the transferor to provide the transferee with specific information about the employees who will be transferred, called “employee liability information”. It consists of:

• the identity of the employees who will transfer;

• their age;

• statements of their employment particulars;

• collective agreements;

• disciplinary proceedings within the previous two years;

• grievances raised by those employees within the previous two years; and

• legal action taken by the employees against the employer in the previous two years and potential legal actions.

A failure to provide this information will result in a financial penalty for the employer. The information must be provided at least two weeks before the transfer date.

In its 2005 consultation document in advance of the introduction of the new Regulations, the then Labour government expressed the hope that requiring the seller to provide this information “will help to ensure transparency in the transfer process and to prevent instances of sharp practice — such as where, shortly before a transfer is completed, the transferor changes the terms and conditions and/or the composition of the workforce assigned to the undertaking in question, to the disadvantage of the transferee”.

What about the employer’s data protection obligations?

The Information Commissioner has published a Guidance Note on data protection good practice in connection with the disclosure of employee information under TUPE. It can be accessed on line at www.ico.gov.uk. The Data Protection Act 1998 (DPA) does not prevent the transfer of this information, as it is being handed over in order to comply with a legal obligation. However, both the out-going and in-coming employer must comply with the Data Protection Act when handling the information provided, for example by ensuring it is accurate, up-to-date and secure.

Often, employee information will be provided beyond the requirements imposed by TUPE (for example, in the early stages of a sale, where there may be many bidders, only one of whom will become the transferee, or on a share sale, where TUPE does not apply). Where this happens, the Guidance recommends safeguards such as anonymising information where possible, or seeking employee consent, and agreeing terms for the protection of the information.

Industrial action

A dispute over a transfer to another employer can amount to a “trade dispute” (a dispute between workers and their employer over their terms and conditions) and therefore can be the basis for industrial action. This was confirmed by the Court of Appeal in the case of Westminster City Council v UNISON ([2001] EWCA Civ 443), where there was a dispute over who was to be the new employer.

However, the dispute must relate to the terms and conditions of those who are affected by the transfer.

In the case of University College London Hospital NHS Trust v UNISON [1999] IRLR 31, industrial action aimed at getting guarantees from their current employer about the terms and conditions of future workers who might be employed by the new employer was held not to amount to a trade dispute. Note also the limited definition of “affected employees” in the recent case of UNISON v Somerset County Court ([2009]UKEAT0043) discussed in Chapter 4.

The normal legal rules apply — there must be a properly conducted ballot, with appropriate notice given to the employer. These rules are set out in the LRD booklet, Taking industrial action.

Checklist for representatives

• Seek an early meeting with management to clarify what is happening.

• Obtain information on who and what is likely to transfer.

• Ask for information on any potential bidders, including information on their financial performance, their current terms and conditions, whether they have recently declared any redundancies, and whether they recognise unions.

• Seek agreement from the current employer for union representatives to interview or meet prospective bidders.

• Seek agreement that employees who do not want to transfer retain the right to remain with their current employer and agree the basis for this.

• Ensure that the employer provides facilities for meeting with affected employees and other representatives both at the current workplace and at the workplace where work is being transferred.