This month I have seen an increase in the number of queries related to the Transfer of Undertakings (Protection of Employment) (TUPE) Regulations and thought it would be a good idea to give you a brief overview of some of its provisions.
One of the most problematic aspects of TUPE for employers is where they decide to oursource a service provision. If an employer decides to outsource a service which is currently carried out by one or more of their employees (which could be as wide-ranging as cleaning, IT support, finance or payroll), it is likely that this would be considered a "relevant transfer" under the latest version of TUPE, meaning that the employee doing the work would transfer to the new provider (under their existing terms and conditions of employment and with their length of continuous service protected). This is also the case if the service is already outsourced and it is being transferred from one provider to another, or if an outsourced service is being brought back in-house.
If you are the original employer, you have a statutory duty to consult with the transferring employee(s) in good time and to let them know what plans the new employer has for them. If you are the new employer you take on all the liabilities of the old employer in relation to the employee. It is for that reason that both employers are well advised to co-operate with each other and to plan the transfer carefully.
In many cases, it is impractical for the new employer to take on the employee. However, unless the employee elects not to transfer of their volition, a dismissal will take place. As well as the normal protection that the employee has against unfair dismissal, there are separate and more complicated rules in relation to dismissal under TUPE. It is normally the case that the new employer will be responsible for dismissing the employee after the transfer has taken place, and will only be able to do so fairly in a limited number of circumstances.
If you are thinking of outsourcing a service, or if you are a service provider taking on service contracts from employers, you need to think carefully about the implications of TUPE and to take advice over the procedure that you should follow.
Contact me for further information.
