Changes to collective terms 





In England, Wales and Scotland (but not Northern Ireland), changes to contract terms incorporated from a collective agreement are no longer a breach of TUPE even if there is no ETO reason, provided:


• any change takes place more than one year after the transfer date; and 





• the contract terms, “when considered together”, are “no less favourable” to the employee than those in place immediately before the transfer (regulation 4(5B), TUPE, as amended).




This does not mean that the employer has a free hand to make changes to collectively agreed terms after a year. Any change must be by agreement. Where a union is recognised, that agreement should be negotiated through collective bargaining. 


Although negotiation can begin at any time, the change cannot take effect until one year after the transfer date. 





Any change that is less favourable overall will be void. Any dismissal for refusing to agree that change will be automatically unfair. 





Only terms “incorporated” from a collective agreement are caught. Many terms with a collective dimension will not be “incorporated” from a collective agreement, for example: terms fixed by external pay review bodies or derived from custom and practice, employer policies or staff handbooks, or terms incorporated from statutory instruments, even if negotiated by a trade union. The new law may also not cover terms derived from a collective agreement but written out in full in a member’s individual contract terms, or terms imposed on employees following a failed collective negotiation. All these examples would need to be tested in litigation.





An offer by the new employer the main purpose of which is to achieve a situation whereby transferred employees no longer have their terms and conditions negotiated by a union would infringe section 145B of TULRCA. Compensation is payable to each union member made an unlawful offer (see page 151, Chapter 5).




These changes to TUPE, designed to undermine collective terms, are open to attack as an infringement of Article 11 of the European Convention on Human Rights, together with other international laws and conventions ratified by the UK government to support collective bargaining (see Chapter 5).