Welcome to this HR Blast that aims to ‘blast’ away some of the myths around TUPE. As an employer with staff about to transfer in, perhaps you have more options than you thought? At Jaluch we have seen a considerable upswing in the numbers of mergers and acquisitions, some of which may trigger TUPE obligations so hope that this article is timely.
👉 If you are looking for an introduction to TUPE, have a read through our TUPE or not TUPE? Blast.
Myth #1 – You cannot make changes to employees’ terms and conditions if they have been TUPE transferred.
This is wrong. You can! And this is the whole reason for the term ‘measures’ in the legislation which covers any ‘action, step or arrangement’ taken in connection with the transfer and discussed during the consultation process (before the TUPE happens). For example, alterations to hours or benefits, relocation or redundancy (more about that later…)
The obligation to consult is triggered if the relevant employer envisages that, in connection with the transfer, it will be taking ‘measures’ in relation to any affected employees.
TUPE requires the obligation to consult to be more than simply giving the appropriate representatives the opportunity to air their views: it must be with a view to seeking their agreement to the measures.
👉 Jaluch can provide training for employee reps involved in TUPE consultation. Bespoke options available.
Myth #2 You only have to inform the incoming workforce about the TUPE transfer.
This is wrong. There is a requirement of the transferor (outgoing employer) and transferee (incoming employer) to inform and (if appropriate) consult with recognised trade unions or elected employee representatives in relation to any affected employee.
- Who are ‘affected’ employees?
- Any Employee who may be affected by the transfer or may be affected by measures taken in connection with it.
- It doesn’t matter if they are not transferring
- This includes three categories of worker:
- Employees who are to be transferred.
- Employees of the transferor who are not being transferred to the transferee but whose jobs may be affected by the transfer.
- Employees of the transferee whose jobs may be affected as a result of the transfer.
Better safe than sorry so whether you are selling, buying or merging please do get in touch to double check you understand your options!
Myth #3 You cannot make someone redundant after they have TUPE’d into your organisation.
No! This is wrong. You can and actually one of the main changes in the regulations in 2014 (remember those… ‘as amended in 2014) actually facilitated that process, allowing the new employer to begin redundancy consultations before the TUPE transfer took place, so long as the company transferring the employees agreed to it.
It is correct though that under TUPE, any dismissals that are made solely or principally because of the transfer are automatically unfair unless the dismissals are on the basis of ‘economic, technical or organisational reasons’. For example, it may be necessary for a new employer to close part of its’ operation to make it economically viable.
Myth #4 You have to accept all staff transferring in.
No you don’t! In order for an employee to transfer they need to be “employed by the transferor and assigned to the organised grouping of resources or employees that is subject to the relevant transfer”.
The critical test of ‘assignment’ required here can be broken down into three relevant questions here:
- Is there an organised grouping i.e. a grouping of employees, deliberately organised by reference to the specific requirements?
- Are the activities the principal purpose of the organised grouping?
- Are the employees assigned to the organised grouping?
Beware of lemon dropping employees… this is where the outgoing employer places employees they don’t want on the transfer list in the hopes they will transfer and equally importantly, hoping the transferee will pick up the redundancy cost……just because the transferor wants you to take on certain staff does not mean that your hands are tied!
Why might an employee not transfer?
- They do not perform work on that contract at all
- They have only been assigned to the contract for a short period of time
- Their work is split over numerous contracts and therefore is not sufficiently assigned to the service.
- They are on long term sick with no chance of return
It is vitally important that you do your due diligence with the Employee Liability Information and if in doubt ask more questions ! Remember the deadline for receiving relevant transfer information is 28 days before the transfer.
For advice on due diligence, please do call one of the Jaluch team. Please don’t be the next business that asks about discipline but forgets to ask about holidays.
Myth #5 You don’t need to elect staff reps if you are a small organisation.
Be very way of how ‘small’ is defined in law! Unless you are a micro business (9 or less employees) you should elect reps or at least give employees the option to elect.
Remember that failure to inform and consult can be a costly business… a sum determined by the Employment Tribunal in consideration of how serious the failure to consult has been and subject to a maximum of 13 weeks’ gross pay for each affected employee.
How Jaluch can help
We can provide advice on all aspects of TUPE. Get in touch with one of our friendly team for further info. Pay-as-you-go, contract free support available.
If you need TUPE documentation, including transfer letters then have a look at our template HR document website, Docs Wizard. You can download a full suite of TUPE letters plus over 400 other legally complaint HR documents including letters, policies and contracts for £499+VAT.