The new Collective Redundancies & Transfer of Undertakings (Protection of Employment) Regulations 2014, TUPE 2014, come in to force on 31 January.
The reforms aim to reduce bureaucracy and increase flexibility around the regulations, which protect employee rights when the business or undertaking that employs them is transferred to a new employer.
However, law firm DWF’s head of employment Mark Hammerton said the amendments would not satisfy all employers.
“While the Government has been managing expectations regarding a wholesale liberalisation of TUPE and an end to the UK’s ‘gold plating’ of EU legislation, these latest changes will still leave many disappointed,” he said.
“In short, TUPE 2014 is EU-driven, much like its predecessor, and seeks to protect the jobs and terms and conditions of employees at a time of business or organisational change, such as the sale of a business or many outsourcings.
“As a result, the employer’s freedom to act with impunity and without additional cost is restricted.”
Hammerton said the biggest change to the legislation was an amendment to Service Provision Change, which states that a service must be fundamentally the same for TUPE to apply.
“This will introduce greater scope for the new contractor to argue that the legislation is not applicable at all, and may present a number of issues for both the contractor and customer,” he said.
“Overall, the Government has made a respectable attempt at using what modest ‘wriggle room’ it has under EU law to clarify TUPE in a number of respects. But those hoping for a more radical, free-market overhaul will be frustrated and will have to hope for a more fundamental reworking of the EU-UK relationship.”
Current TUPE legislation has not been updated since 2006.
TUPE 2014 changes
Changes announced in TUPE 2014 include:
- Service Provision Change (SPC) introduced in 2006 will continue but only where the new activities being carried out are “fundamentally the same as the activities carried out previously”
- Employers are now able to count pre–transfer consultation for collective redundancy timelines
- An additional 14 days for current employers to provide employee liability information
- A static approach applied to collective agreements whereby the new employer is bound by the terms as ‘frozen’ at the point of transfer
- The dismissal of an employee under Regulation 7 of TUPE 2006 will now only be automatically unfair if the reason for the dismissal is the transfer itself
- A change in the place of employment will now be a justifiable reason for dismissal, even where TUPE has led to the dismissal
- Employers will be permitted to consult directly with employees in relation to a relevant transfer where there is no recognised independent union, nor any existing representatives, and fewer than 10 employees