What is a TUPE transfer within group companies?
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TUPE transfers apply even if the business moves within a group of companies.
Where there is a transfer of a business, or part of a business, from one employer to another, this counts as a transfer under the Transfer of Undertakings (Protection of Employment) Regulations (somewhat more simply known as TUPE). Even if the transfer is between two companies in the same group, it still counts.
What are the rules around TUPE?
All employees employed in the business or part of the business being transferred will automatically transfer to the new employer along with the business. The transfer of employees happens automatically – the employers can’t agree that the employees won’t transfer. Again, this is the case whether or not the companies are part of the same group.
Employees can object to the transfer – view our ‘Can you refuse TUPE?‘ article for more information.
What is TUPE between group companies?
What difference does it make when a TUPE transfer is between group companies? Answer – none.
If the group is reorganising how it operates between two or more subsidiaries, employees may also be shuffled between those subsidiaries to follow the functions, operations, customers and goodwill being transferred. As with any TUPE transfer, employees must be notified if any “measures” are proposed by the transferee employer.
Usually, with an in-group transfer, employees won’t notice any changes to what they do, or how and where they do it, aside from a new name on their payslip, because the point is that it’s just a group reorg and no practical changes are intended. In other words, it’s rare for “measures” to be taken in an in-group transfer.
But, there is still some procedure to comply with – it’s not just an admin exercise. It’s best to get advice before proceeding to make sure you comply with both employers’ obligations under TUPE, and avoid falling into any potentially expensive traps.
There is nothing you can do as an employee to avoid a TUPE situation.
How can I avoid TUPE?
You can’t. TUPE applies automatically to any transaction or transfer that fits the definition in the legislation. You can’t agree not to have employees transfer under TUPE.
This question is more commonly asked where there is a transaction between two separate businesses, not within a group, i.e. it’s a “cold” arm’s length deal, not an in-group reorganisation that’s largely administrative.
But it bears reiterating that it’s not a choice whether to transfer employees – the whole purpose of TUPE is to protect employment rights (see the long title above).
Without TUPE, employees would lose their jobs and the old employers would be paying redundancy costs (generally notice, accrued holiday and statutory redundancy pay), and the new employer wouldn’t be sure that they could recruit those employees to gain the benefit of their institutional memory.
It’s not impossible to dismiss employees who are surplus to requirements after a TUPE transfer – whether it’s a commercial transaction or an in-group transfer. You just need to be pretty careful and always get advice on how to avoid the many traps and potential claims.
Employment solicitors
TUPE is one of those European inventions which are really complicated but overall, a Good Thing. If you need help with any aspect of an in-group TUPE transfer, just get in touch at employment@Qlaw.co.uk or on 03300 020 863.
I am looking for some free advice please.
I work for a small, local charity. Part of our work has gone out to Tender. The specifications in the Tender document are completely different to the present job, and the way we work. However, I have been informed that my job may be included in a TUPE arrangement.
Having actually read the Tender document though there is nothing in it that relates to my present role. The details of the way the work is to be carried out bears no resemblance to how we and I work now. My concern, therefore, is that, if TUPE’d my role and my Terms and Conditions will be immediately and completely changed and I would have to relocate to another base or bases.
I am currently contracted to work 0830 – 1600hrs Monday to Thursday, for example, but the requirements in the new spec’ are for 7 days a week availability – including evenings to include social events. Also, instead of working from a single office within reasonable walking distance from my home the new spec’ requires regular, multi-site working. This is a concern as I do not use a vehicle for work.
It is my opinion that my specific role is being made redundant but where do I stand with all of this please?
Thanks for getting in touch. We can absolutely help with your query, however, we aren’t allowed to give legal advice unless you’ve formally instructed us and agreed our terms. I’m sure you’ll understand – the value we add is in giving legal advice about your individual situation, that you can rely on. The general information given on our website isn’t legal advice, and I can’t give you advice in this email.
You raise several questions:
1. Whether your job will be transferred under TUPE – if your job is wholly or mainly in the part of the organisation that’s being put out to tender, then it’s possible your job will be part of what transfers automatically under TUPE. I can advise on this once I’ve got full details from you of the tender and your role.
2. Your queries about how your job might change seem to me to be things that should be covered in the information and consultation process that employers are obliged to conduct in relation to a TUPE transfer. You’ll find more information here – basically employers must always “inform” affected employees of a TUPE transfer and if the buyer/incoming contractor intends to take any “measures” then both employers must “consult” with all affected employees as well. Sometimes consultation can’t happen (or can’t fully happen) until after the transfer when the incoming employer is able to talk to employees.
3. Following on from the general question of whether your terms and conditions, place of work etc may change, any change to your terms and conditions connected with the TUPE transfer may be invalid, and/or may give you a claim, against one or both of the employers concerned. You’d transfer with all terms intact, including continuity of employment and hours of work. So, you may have a complaint if a change is imposed, and more so if it’s done without due consultation.
4. In terms of a potential redundancy, if you don’t want to transfer, you can reject the transfer – though I’d recommend that you take legal advice before doing so because there are risks involved. If you were made redundant, I would certainly recommend that you instruct us to advise you on your position and options, as you may have potential claims, or at least entitlement to certain payments in connection with a redundancy.
In order to advise, I’d need the names and addresses of both organisations, along with full details of the situation and all relevant documents (including your contract, the tender and all communications you’ve got about the tender and TUPE transfer). Once I’ve seen the volume I need to review, I can confirm a fixed fee to review everything and meet with you to discuss fully and advise on your position and options. Assuming that there isn’t a huge volume of documentation, I would expect a fixed fee for the first stage of work in a matter like yours to be between £500-£750 plus VAT, but can only confirm once I’ve seen the documents I need to review. If further work was required, additional fees would be charged.
If your employment ended up terminating with a settlement agreement, again, I can certainly help there – you have to get independent legal advice before signing a settlement agreement. There’s lots of information about settlement agreements on our website.
I hope this note is helpful at this stage and do get in touch if you’d like to instruct us. If you’d like to book an exploratory call to talk through your situation in more detail then you can book a time to chat and we’ll go from there.
(NB – our articles and any comments thereon do not represent legal advice and should not be taken as such. If you require legal advice about your particular case, please make contact with us).