What is TUPE?
The purpose of TUPE is to protect employees if the business in which they are employed changes hands. Its effect is to move employees and any liabilities associated with them from the old employer to the new employer by operation of law.
TUPE is an acronym for the Transfer of Undertakings (Protection of Employment) Regulations. The Regulations were first passed in 1981 but overhauled in 2006. TUPE is a significant and often tricky piece of legislation adopted by the UK in order to implement the European Acquired Rights Directive.
Why do you need to know anything about TUPE?
TUPE applies every day to an enormous number of different business transactions and it is essential that employers of all sizes understand what employment liabilities can arise. TUPE can apply (to name but a few of many examples) when employers:
sell or buy part or all of a business as a going concern;
outsource or make a service provision change involving either (a) an initial outsourcing of a service (e.g. where services transfer from the customer to an external contractor); (b) a subsequent transfer (e.g. where services transfer from the first external contractor to a different external contractor; and (c) bringing the service back in-house (e.g. where services transfer from an external contractor back to the customer);
grant or take over a lease or licence of premises and operate the same business from those premises.
What do businesses need to know about TUPE?
To protect your business from claims, you need to understand:
when TUPE is likely to apply;
what TUPE means legally;
what you have to do to comply with TUPE and the penalties for failing to do so; and
what other steps you can take to protect your business from the effects of TUPE.
