TUPE Update 2006 Introduction

1
TUPE Update 2006Introduction

• TUPE Updated
• Comes into effect April 2006
• Existing foundations built upon in 4 key areas
• When TUPE applies
• Pre -Transfer obligation to notify
• Post Transfer ability to change Ts and Cs
• TUPE and Insolvency

2
TUPE Update 20061. TUPE Applicability

• New definition of Service Provision Change
• Aim to reduce uncertainty in law
• No need to show transfer of assets or employees
• Exceeds EC requirements
• TUPE will apply where
• Service Activities cease by one person
• Taken up by a new person
• Where organised group of employees whose
  principal purpose is to carry out those
  activities on behalf of a client

3
TUPE Update 20061. TUPE Applicability

• Service Changeover
• Exceptions
• Limited to where on service provision change, the
  new provider carries out activities with a single
  specific event or task of short term duration
• Or where activities consist wholly or mainly of
  supply of goods for clients use
• However these exceptions may be caught by the
  general definition of TUPE

4
TUPE Update 20061. TUPE Applicability

• Practical Impact
• TUPE will apply in most outsourcing/insourcing
  scenarios
• Where contracting with service providers like
  Accountants and Solicitors ensure that no one
  individual or group of individuals at service
  provider is permanently assigned to your work as
  TUPE may apply when you wish to move your
  business
• Similarly if providing services ensure employees
  are not specifically assigned if you wish to
  avoid TUPE

5
TUPE Update 20062. Notification Requirements

• New Requirement for Transferor to notify
  Transferee of Employee Liability Information
• Existing law on information and consultation
  unchanged
• Except liability for failure to consult will be
  the joint and several liability of Transferor and
  Transferee

6
TUPE Update 20062. Notification Requirements

• What is Employee Liability Information?
• Following information on every employee assigned
  to Undertaking
• ID and age of employee
• Employment Particulars
• Information on any disciplinary or grievances to
  which Dispute Resolution Procedures apply within
  last two years
• Court or ET claims within the last two years
• Any claims that the Transferor may reasonably
  believe that the employee may bring against
  Transferee
• Information of any Relevant Collective Agreements

7
TUPE Update 20062. Notification Requirements

• Second Area Notification Requirements
• When and How do you Notify?
• Not less than 14 days before the Relevant
  Transfer
• In writing in one or more instalments
• Probably Exempted under DPA
• What is the remedy for failure to notify?
• Transferee can take Transferor to ET
• Just and Equitable compensation having regard to
  the losses sustained subject to a minimum of
  500.00 per employee

8
TUPE Update 20063. Validity of Post-Transfer
changes to Ts Cs

• The ability to change Ts and Cs post transfer is
  still difficult even consensually
• However post-transfer changes will be permissible
  if
• The changes are unconnected to Transfer
• Or if connected to Transfer there is an ETO
  reason entailing changes in the workforce
• This change appears to contradict an ECJ case, so
  may be struck out by ECJ in due course

9
TUPE Update 20064. TUPE and Insolvency

• Fourth AreaInsolvency
• Tries to promote rescue culture by
• Limiting the transferees liability for employees
  dismissed by Transferor
• Allows variation of employment contract post
  transfer via appropriate employee representatives
  to safeguard employment opportunities

10
TUPE Update 2006Summery

• Safer to assume TUPE applies to service provision
  changeover ambiguity is whether employees in
  question have as a principal purpose carrying
  out work for the client
• If Transferor - Collate information on Employee
  Liabilities
• If Transferee
• Obtain information on Employee Liabilities
• Slightly more scope for post-transfer changes to
  Ts and Cs