TUPE and insolvency

Regulations 8 and 9 of the TUPE regulations introduced a new insolvency regime intended to encourage the rescue of failing businesses to safeguard employment opportunities. This regime remains unchanged by the 2014 Regulations, although the changes to the wording of regulation 7 make it much easier for administrators to carry out dismissals before a transfer.

The TUPE insolvency regime is only triggered where an insolvency practitioner has been formally appointed to take charge of the business before the transfer date (Secretary of State for Trade and Industry v Slater [2007] UKEAT 0119/07/2706). The rules distinguish between sales of the business as a going concern, and liquidation sales aimed at selling off the assets, paying off the creditors and winding up the business.