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Changes to TUPE Regulations – expected 31st January 2014

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The Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 2013 are due to come into force on 31st January 2014. The Regulations amend parts of the Trade Union and Labour Relations (Consolidation) Act 1992 and The Transfer of Undertakings (Protection of Employment) Regulations 2006.

The key changes are:

Pre-transfer consultation can count as complying with the collective redundancy rules. The draft Regulations amend parts of Trade Union and Labour Relations (Consolidation) Act 1992 so that a transferee can elect to consult representatives of affected employees who are transferring, before the transfer provided that it notifies the transferor in writing and the transferor agrees. This is a useful change as currently the law does not provide for a transferee to start consultation on redundancy until the moment of transfer and this can cause significant delays where there are over 20 or 100 anticipated redundancies and hence a 30 or 45 day consultation period is required. However, under the Regulations, the transferee can also cancel its election to consult and the amendments to TULRCA are complicated and deserve a detailed review if the transferee is to take advantage of this change.

Dismissal will remain automatically unfair and changes to contract terms void (in the absence of an Economic, Technical or Organisational reason) if the reason for dismissal or variation of contract ‘is the transfer’ but not if the reason ‘is one connected with the transfer’.

Change of location will be an Economic Technical or Organisational reason and hence dismissal on the grounds of a change of location will no longer be automatically unfair or the new contract term be void, as has been the case to date. This is a useful amendment to address the current difficulty which arises when the transferee business or new service provider operates at a different location often many miles away.

Service provision changes will continue to fall under the TUPE Regulations as long as the activities being carried out after the transfer or change are “fundamentally the same” as those carried on before it. There may be some scope for arguing TUPE does not apply where the services to be provided are significantly different or to be provided in a significantly different way post transfer.

The timetable to provide employee liability information is lengthened so this must now be given to the transferee 28 days before the transfer, not 14 days as at present. This is a practical amendment giving transferee businesses more time to prepare.

Businesses with less than 10 employees will be permitted to inform and consult directly with employees where there are no existing recognised union or appropriate representatives. Again this is a sensible amendment as the current requirement to consult with employee representatives makes no sense where very small numbers of employees are involved (the exception only applies to small businesses and not where less than 10 employees are being transferred to or from larger businesses).

Collective Agreements – Variation of terms allowed and transferee not bound by post transfer changes – The Regulations provide that terms derived from a collective agreement with Unions may be varied one year after the transfer provided the change is no less favourable overall. Also any terms of collective agreements which are agreed by the transferor post transfer and to which the transferee is not a party will not bind the transferee. This prevents the transferee being tied into changes over which it has no control.

The Regulations provide that the majority of the amendments will apply to transfers that take place on or after the commencement date (which has been announced to be 31st January 2014) or where notice of dismissal is given on or after that date. However, the changes to the time limit for providing employee liability information and the relaxation of the information and consultation obligations for micro businesses, may be implemented up to 3 or 6 months respectively after the commencement date.

For further information please contact Andrew Egan on 01635 521212 or andrew.egan@clmlaw.co.uk

 

Written by Andrew Egan

January 22nd, 2014 at 5:53 pm