Advice for businesses on the recent TUPE reforms
FOLLOWING the government’s recent employment pretection law changes around collective redundancy and transferring one business to another, local solicitors, Parrott & Coales has produced a useful guide to the changes for business owners.
Alison Lythgoe, Employment Solicitor, Parrott & Coales
Many businesses may have been left disappointed by the changes to the Transfer of Undertakings (Protection of Employment) – TUPE – legislation announced last week, due to come into force on 31 January 2014. The reforms followed a period of consultation after which the Government published the final version of The Collective Redundancies and Transfer of Undertakings (Protection of Employment) Amendment Regulations 2014 (“The Amendment Regulations”); legislation to protect employee rights when the business or undertaking that employs them is transferred to a new employer.
The reforms to TUPE aimed to simplify the legislation, increase flexibility and reduce bureaucracy by bringing an end to the UK’s ‘gold plating’ of EU legislation. Yet, recent reports suggest the new legislation is unlikely to satisfy all employers who were hoping for a more liberalised TUPE.
According to the employment law team at Aylesbury based solicitors, Parrott & Coales, the most significant change for businesses is an amendment to Service Provision Change transfers, which confirms that a service must be fundamentally the same before and after the transfer for TUPE to apply.
Alison Lythgoe, employment solicitor at Parrott & Coales, commented: “This gives the buyer and seller greater flexibility to argue that TUPE is not relevant to their situation, which in turn could cause issues for all parties.
“If TUPE does apply then the seller of the business or outgoing sub-contractors will now need to provide information to the buyer about the transferring employees including their identity, age, particulars of employment and details of any disciplinary and grievance procedures by an earlier deadline of 28 days of the transfer. Failure to provide this information on time could leave the seller liable to legal proceedings by the buyer for compensation.”
The main changes to TUPE that will come into force on 31 January 2014 include:
*Clarification that, for TUPE to apply, the service provision must be “fundamentally or essentially the same” after the transfer as it was before the transfer;
*Allowing microbusinesses (10 or fewer employees) to inform and consult directly with employees where there are no trade union representatives or existing employee representatives;
A CHANGE in the place of employment will now be a justifiable reason for dismissal, even where this change in the place of employment was because of the transfer.
*Employers are allowed to re-negotiate collectively agreed terms of employment one year after the transfer, providing the changes are no less favourable to the employee; and
*Confirming that TUPE consultation can also satisfy collective redundancy consultation rules
*Current employers have to provide employee liability information to the new employer by an earlier deadline of 28 days before the transfer, unless it is not reasonably practicable to do so and then the information is to be given as soon as reasonably practicable.
The new TUPE Regulations will not:
*remove the service provision change definition of a transfer in its entirety
*allow the seller to rely on the buyer’s Economic Technical or Organisational reason, which will apply after the transfer, to dismiss employees before the transfer; or remove the seller’s obligation to provide employee liability information to the buyer.
