As many people will be aware, the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) are in place to provide employees with protection when their employment is transferred to another employer. The coalition government recently carried out a consultation regarding alterations to TUPE and various proposals to change the regulations were recommended. On 31 January 2014 these changes will be introduced via the Collective Redundancies and Transfer of Undertaking Regulations 2014, although not all of the changes will take effect on that date. Outlined below is a note of the key changes which are due to come in.
Restrictions on Varying Terms & Conditions of Employment
Transferees will also be able to renegotiate terms of transferring employees which were incorporated following a collective agreement provided that these changes are no less favourable than those which were in place before the transfer.
Service Provision Changes
Mid-2013 there was discussion that the government were proposing to remove the service provision change element of the TUPE Regulations, meaning they would not apply to this element of business transfers. However the rules on service provision change have been retained, but there will be a slight amendment. For there to be a service provision change under the new regulations, the activities carried out by the transferee must be 'fundamentally the same' as those carried out by transferor or before the transfer. This is likely to give rise to some litigation on this point and will be interesting to see if in practice there is a different approach to service provision changes.
Employee Liability Information
The current TUPE regulations set out that employee liability information must be provided by the out-going employer to the incoming employer before the transfer occurs. However this information will now have to be given 28 days before the transfer, rather than 14 days before the transfer and will impact transfers that take place on or after 1 May 2014.
Businesses with ten or fewer employees may now inform and consult directly with those employees affected. However it should be noted that this will only apply where they aren't existing employee representatives in place.
If you have any specific questions in relation to TUPE please contact our employment team.