LRD guides and handbook February 2014

TUPE - a guide to using the law for union reps

Chapter 4

What if the employer misinterprets the effect of TUPE?

[ch 4: pages 43-44]

An employer’s duty is to consult on the position under TUPE as it genuinely believes it to be. The employer does not promise that its interpretation of TUPE is correct. For example, in Royal Mail Group v CWU [2009] EWCA Civ 1045, the Court of Appeal accepted that Royal Mail genuinely but mistakenly believed, based on legal advice, that TUPE did not apply to the transfer of a number of post-office branches to WH Smiths, and Royal Mail consulted on this basis with the CWU. The Court of Appeal held that it had met its statutory obligation to consult, because it consulted on the basis of its genuine understanding of the legal position, however flawed.

However, it seems unlikely that this “get out” would help an employer who fails to provide any information or engage in any consultation at all until after the transfer date has passed, because it fails to recognise even the possibility that TUPE has been triggered.

Moving outside of the the statutory framework, remember that an employer will be liable in negligence and breach of contract if it fails to take reasonable care when informing reps about the effects of the transfer, leading employees to take action they would otherwise have rejected. For example, in Hagen v ICI Chemicals [2002] IRLR 31, employees agreed to transfer their employment under TUPE because they were told their pension rights would be more or less the same. This was not the case, and some employees lost out substantially. The High Court said this was a breach of contract and that the employees could claim damages from their old employer.

This duty does not extend to a duty to advise employees of their best choice (University of Nottingham v Eyett [1999] IRLR 87).