What does TUPE do?

It PRESERVES and PROTECTS

1. TUPE PRESERVES

When there is a transfer from an old employer ("transferor") to a new employer ("transferee") all the transferor's employment duties and liabilities towards its employees are transferred to the transferee; and anything that has been done by the transferor is deemed to have been done by the transferee. The terms and conditions of work as transferred to the transferee should remain the same.

The following are passed from the transferor to the transferee:-
  1. Outstanding debts - e.g. arrears of wages
  2. Statutory Employment Rights - e.g. unlawful discrimination, maternity rights, Wages Act claims etc
  3. Continuity of Service
  4. Other legal rights connected with the Contract of Employment - possibly including personal injury claims.
There are a number of employment rights and contract terms which for practical reasons it may not be possible for the transferee to duplicate or operate in precisely the same way as the transferor. These provisions should be operated and interpreted following the transfer in the most sensible practical way they can in the new environment, or, if this is not possible, it may be argued that the transferee should make comparable alternative provisions. These include:
  1. Commission or profit sharing schemes
  2. Restrictive Covenants
  3. Job title, grading and seniority rights

2. TUPE PROTECTS

The transfer does not terminate the Contract of Employment.
If an employee is dismissed for a reason connected with the transfer then: -
  1. The dismissal will normally be assumed to be unfair, and liability will pass to the transferee even if dismissal occurred before the transfer but
  2. To establish that the dismissal was fair the employer would have to show that the reason for dismissal was an economic, technical or organisational reason entailing changes in the workforce. The tribunal would then have to be satisfied that the dismissal has been carried out reasonably in all the circumstances according to the usual tests for unfair dismissal.

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Other rights

Both the transferor and the transferee are obliged to inform and consult representatives of their employees who may be affected by the transfer. The consultations must be with representatives of any recognised trade union or with any other elected representative of the employees.

Consultations should commence long enough before the transfer to be meaningful. The employees' representatives have the right to receive certain specified information and to make representations. The employers should consider those representations and reply to them.

This web site is not a definitive statement of the law. The law in this area is extremely complex and this simplified guidance should not therefore be relied upon in legal proceedings. Should any problems arise concerning the law in this area you should consult your union.