Relevant transfers
[ch 2: page 14]Relevant transfers are defined in Regulation 3, TUPE. There are two types:
• a business transfer: where a business or undertaking (or part of a business or undertaking) is transferred from one employer to another as a going concern. It can include cases where two companies combine to form a new company; and
• a service provision change: where an employer’s activities are either contracted out for the first time (first generation outsourcing), given to a different service provider (second generation outsourcing), or brought back in-house (insourcing).
The two categories overlap, and reps need a broad understanding of both. The difference between the two has become increasingly artificial, but some significant differences remain.
The need for a change of employer means that TUPE does not normally apply to share sales (Millam v the Print Factory (London) 1991 Limited [2007] EWCA Civ. 322).
Although there must be a change of employer, there need not necessarily be a formal documented transaction. TUPE will be triggered by any group reorganisation or restructuring where the employer changes (Allen v Amalgamated Construction C-234/98 [2000] IRLR 119).