Government announces TUPE change proposal

The government has announced proposed changes to the Transfer of Undertakings (Protection of Employment) Regulations (TUPE) rules.

The move comes in response to a consultation on TUPE regulations earlier this year.

The government has confirmed that:

  • Employers will be able to renegotiate terms and conditions provided for in collective agreements one year after a transfer, provided that overall the change is no less favourable.
  • It will make clear that where employees have terms and conditions provided for in collective agreements, only the terms and conditions in the collective agreement existing at the time of the transfer will apply to the employment with the new employer. Later changes to the collective agreement will not bind the new employer if it is neither a party to the subsequent collective agreements, nor takes part in the process for bargaining them.
  • It will not repeal the service provision change rules. These rules mean that TUPE will usually apply to the change in the provision of a service, such as security guarding services for a business, where there is a group dedicated to the service for the client.
  • It will provide clarification of the rules on service provision changes. The government will set out part of the test which determines whether there has been a service provision change. For a change to have happened, the activities carried on after the change must be fundamentally or essentially the same as those carried on before it.
  • It will amend the rules so that where the place of work changes after the transfer, any redundancies due to that change will not be automatically unfair.
  • It will allow micro organisations to inform and consult employees directly when there is no recognised trade union or other existing representatives.

The new regulations will be laid in parliament in December 2013.

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Jo Swinson, employment relations minister, said: “By making these changes we will clear out the cobwebs in some of the rules, which will give businesses more clarity about conducting transfers.”

Tim Thomas, head of employment policy at EEF, added: “Today’s announcement will remove some of the TUPE gold-plating, which covered dismissals and changes contracts, and help ease the burden of TUPE, reforms, which businesses need and have been waiting for.”