TUPE
If you are buying or selling a business (which can include part of a business or where you are giving up or taking over an existing contract for the provision of services) you need to be aware of the impact of the Transfer of Undertakings Regulations 2006 (commonly known as "TUPE").
The effect of the TUPE legislation is that:
- The employees transfer with their continuity of employment unbroken;
- They transfer to the buyer under their existing terms of employment - you must not change terms and conditions;
- Any dismissal of an employee with continuous employment of a year or more will be unfair when the sole or principal reason is:
- the transfer itself; or
- a reason connected with the transfer that is not economic, technical or organisational reason entailing changes in the workforce (ETO) e.g. a reason relating to the management or organisational structure of the buyer's business.
- The buyer and seller are required to inform and consult with appropriate representatives of any affected employees before the sale goes through. Where an employer recognises a trade union, it must consult with the union;
- The seller is obliged to provide the buyer with certain details in respect of the seller's employees as far in advance of the transfer as possible. The information must be given not less than 14 days before the transfer;
- Employees have the right to object to their transfer to the buyer.
The rules laid down by TUPE are complex and very technical. We are here to assist you with compliance so that you may avoid potential claims for a failure to comply with TUPE or unfair dismissal claims which can be very expensive.
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