Government proposals for reform of TUPE

by DLA Piper
Contact

The government has today published a response to the consultation on reform of the TUPE Regulations which it carried out earlier this year. Having taken account of the 178 consultation responses, the reforms which the government is now proposing are considerably less radical than those which it was originally considering. In particular, there has been a u-turn on the proposals in relation to the service provision change rules which will not be repealed because, "the responses to consultation presented a clear rationale for retaining the current rules". For details of the matters addressed in the January 2013 consultation, see our previous Be Alert.

Proposals for reform

The key proposals emerging from the response to consultation are as follows:

  • The service provision change rules will not be repealed in view of the certainty which these rules provide to business. The Regulations will be amended, however, to reflect the case law approach, namely that for there to be a TUPE service provision change, the activities carried on after the change in service provision must be "fundamentally or essentially the same" as those carried on before it.
  • The rules about employee liability information are also to be retained and the time before the transfer when this information must be given to the transferee will be extended from 14 to 28 days.
  • Transferors will not be permitted to rely on a transferee's "economic, technical or organisational reasons" to dismiss an employee prior to transfer. However, the collective redundancy consultation legislation will be amended to clarify that consultation which begins pre-transfer can count for the purposes of complying with the collective redundancy rules, provided that the transferor and transferee can agree and where the transferee has carried out meaningful consultation.
  • Renegotiation of terms derived from collective agreements will be allowed one year after the transfer, even though the reason for seeking to change them is the transfer, provided that overall the change is no less favourable to the employee.
  • Where terms are derived from a collective agreement, only those in existence at the date of transfer, and not any subsequently incorporated into the collective agreement, will be binding on a transferee.
  • The Regulations will be amended to provide that changes in the location of the workforce following a transfer can be within the scope of "economic, technical or organisational reasons entailing changes in the workforce". This will prevent genuine place of work redundancies from being automatically unfair.
  • Changes will be made to the wording of the Regulations which restricts changes to terms and conditions and which protects employees against dismissal because of a transfer to bring it closer to the language of the underlying Acquired Rights Directive. The Government wants to make it clear that the requirements of TUPE are no wider than those of the Directive.
  • Micro businesses will be able to inform and consult directly affected employees when there is no recognised independent union, nor any existing appropriate representatives.

The government intends to publish revised TUPE Regulations in December 2013. The consultation response does not indicate when these will come into effect. Informally, BIS has suggested January 2014 but this may well slip to April 2014.

Implications

The impact of most of the proposed changes will be fairly limited but they will bring more clarity and commercial sense to business transactions. In particular, for example, despite the associated risks, pre-transfer consultation on post-transfer redundancies already often takes place. Formalising that this is an acceptable practice will enable cost-cutting measures to be implemented more efficiently post transfer. Similarly, the extended time period for provision of employer liability information, will be welcome in out-sourcing situations where contractors (particularly those at second-generation) have, to date, often struggled to obtain information about the liabilities they will acquire on contract transfer.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© DLA Piper | Attorney Advertising

Written by:

DLA Piper
Contact
more
less

DLA Piper on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.