TUPE and insolvency
[ch 12: page 405]Regulations 8 and 9 of the TUPE regulations introduced a special insolvency regime which is intended to encourage the rescue of failing businesses and to safeguard employment opportunities. This regime has not been changed by the 2014 Regulations. Even so, other changes to the TUPE regime detailed in this Chapter have made it much easier for administrators to carry out dismissals before a transfer.
The 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 a business as a going concern (insolvent administrations), and liquidation sales aimed at selling off the assets, paying off the creditors and winding up the business.