Government proposal to repeal the service provision change regulations

The majority of respondents to the government’s Call for Evidence opposed the government’s proposal to abolish these regulations. Unions oppose the proposal because it will drive down pay and increase job insecurity, especially among the poorest workers. There is no evidence that it will create any jobs. Expert practitioners oppose it because it will mean a return to uncertainty and litigation as to whether or not TUPE applies. Good employers oppose it because it will mean a race to the bottom in terms of service quality, as only the cheapest providers will win local authority service contracts.

Despite this opposition, the regulations are likely to be repealed. There is to be a lead-in time for any repeal of anything between “less than one year” and “five years or more”.

The main consequence of the repeal will be a return, in all cases, to the “retention of identity” test. In other words, in each transaction, the answer to the question “does TUPE apply?” will be “it depends”.