LRD guides and handbook May 2013

Law at Work 2013

Chapter 12

Some key facts about TUPE

• TUPE protects only employees (see Chapter 2), not agency workers or the self-employed.

• TUPE is only triggered when there is a change in the legal identity of the employer, in other words, where one employer is replaced by another. This is the reason why TUPE is never triggered by a share sale.

• TUPE applies to both the public and the private sector and regardless of whether a business is for profit.

• TUPE rights apply to all sizes of employer and regardless of how few employees are affected. There can even be a TUPE transfer where just one employee is affected (Schmidt v Spar-und Leihkasse der Fruheren Amter Bordesholn (C 392/92 [1994] ECR I-1311), Hunt v Storm Communications Limited (EAT2702546/06)).

• In the private sector, TUPE can apply to internal transfers and reorganisations where staff are moved between different subsidiaries of the same organisation (Allen v Amalgamated Construction C-234/98 ([2000] IRLR 119)). There does not need to be a formal sale and purchase agreement in order for TUPE to apply. In the public sector, intra-governmental transfers are not covered by TUPE. Instead, they are subject to COSOP: the Cabinet Office Statement of Practice: Staff Transfers in the Public Sector.

• TUPE can apply where jobs are transferred out of the UK — even to a non-EU country — as long as the old employer is based in the UK (Hollis Metal Industries Ltd v GMB & another [2008] IRLR 187). This is important because it means a protective award can be claimed from the UK-based employer if consultation is poor or non-existent.

• TUPE regulations have an automatic effect.

• Employees and employers are not allowed to agree between themselves to contract out of TUPE protection. This is because the Acquired Rights Directive recognises the inequality of bargaining power between the two sides.

• Employers cannot escape TUPE by structuring a transaction so that the transfers take place in several different stages (regulation 3(6)).

• Changing the terms and conditions of employees in order to bring them into line with those of the transferred or transferring staff (often described as harmonisation) is a breach of TUPE and is unlawful.

• TUPE protection does not run out after a set length of time. However, the more time that passes following a transfer, the easier it becomes for the employer to show that a change is for a reason other than the transfer.