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A Guide to the TUPE Process: Everything You Need to Know

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Lauren Croft

Lauren is an Associate Director at Empro Group and is a specialist in TUPE processes as a Mobilisation and Business Transformation Specialist.

Are you familiar with the TUPE process? If not, don’t worry—we’re here to guide you through it. 

The TUPE process ensures that employees’ rights are protected when a business undergoes a transfer or takeover. It’s a complex process, but we’ll explain it here. Whether you’re an employer planning a transfer or an employee affected by one… let’s look at the TUPE process and what makes a transition smooth and legally compliant.

Disclaimer: The information provided in this blog is for general informational purposes only. Empro Group is not responsible for errors or omissions in the content. The content is not intended as legal advice and should not be used as a substitute for professional legal consultation. Empro Group is not liable for any actions taken based on the information provided in this blog. Always seek the advice of a qualified legal professional for any legal matters related to the TUPE process.

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The history and importance of TUPE

The Transfer of Undertakings (Protection of Employment) regulations, known as TUPE, was introduced to UK law in December 1981. The goal was to protect employees’ rights when transferring a business from one employer to another.  The Labour government introduced a new set of regulations in 2006; further amendments were made in January 2014.

TUPE plays a crucial role in maintaining job security and stability for employees. It prevents employers from dismissing employees or changing their terms and conditions without a valid reason during the transfer. Not only is it a legal requirement, but it also ensures that employees are treated fairly and their rights are safeguarded.

Key provisions of the TUPE regulations

The TUPE regulations contain several key provisions that employers and employees must know. These provisions include:

1. Automatic transfer of employees: Employees are automatically transferred from their current employer to the new employer. During this process, their employment rights and obligations should remain intact. This means that their terms and conditions of employment, including pay, holiday entitlement, and length of service, should stay the same.

3. Information and consultation: Employers are legally obligated to inform and consult appropriate representatives of employees affected by the transfer. This includes information about the transfer, its effects, and any planned changes.

4. Collective agreements: TUPE preserves the rights and benefits provided by collective agreements. The new employer must follow any collective agreements during the transfer until they expire or are renegotiated.

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When does TUPE apply?

1. Business transfers: When a business or part of a company is transferred from one employer to another. This can occur through a sale, merger, or acquisition.

2. Service provision changes: When services are outsourced, brought in-house, or transferred between service providers. For example, if a cleaning company is replaced by a new provider, TUPE will apply to protect the rights of the employees.

It’s important to note that TUPE does not apply to share transfers or self-employed individuals. Additionally, it may not apply in certain insolvency situations.

The TUPE process step-by-step

The TUPE process involves several key steps that the current and new employers must follow to ensure a smooth and compliant transfer. These steps include:

1. Identifying the transfer: The first step is determining whether a transfer covered by TUPE occurs. This involves identifying the relevant transferable business or service and the date of the transfer.

2. Informing and consulting appropriate representatives: The current employer must inform and consult with employee representatives. This includes information about the transfer, its effects, and any planned changes. Employers must begin this process long enough before the transfer to allow meaningful consultation, typically at least 30 days before the transfer date.

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3. Employee liability information (ELI): The current employer must provide the new employer with employee liability information. This includes details of the transferring employees, their contracts, and any disciplinary or grievance procedures. This information must be provided to the new employer at least 28 days before the transfer.

4. Consultation with affected employees: Current and new employers must consult with affected employees or their representatives. This ensures employees can raise concerns about the transfer.

5. Changes to terms and conditions: Any changes to employees’ terms and conditions must be agreed upon by both the current and new employers. Changes solely due to the transfer are void under TUPE.

6. Employee transfers and integration: Employees automatically move to the new employer with their rights and obligations intact on the transfer date. The new employer must integrate these employees and honour their existing terms and conditions.

7. Redundancies and dismissals: Employers must follow fair and legal procedures if redundancies or dismissals are needed due to the transfer. Dismissals solely because of the transfer are automatically unfair unless there is an ETO reason.

What is Employee Liability Information (ELI)?

Employee Liability Information (ELI) is crucial data that the current employer must provide to the new employer. It includes details about the employees transferring to the new employer, ensuring that the new employer is fully aware of their obligations.

What Must ELI Include?

ELI typically includes the following details:

  • The identity and age of the employees who will be transferred.
  • Information contained in the employees’ written particulars of employment (such as terms and conditions).
  • Details of any disciplinary actions taken against employees within the last two years.
  • Details of any grievances raised by employees within the last two years.
  • Information about any legal actions brought against the employer by employees within the last two years.
  • Details of any collective agreements that apply to the employees.

Consultation and employee rights during the TUPE process

During the TUPE process, employers must inform and consult appropriate representatives of affected employees. This ensures that employees are aware of the transfer and have an opportunity to raise any concerns or issues. The consultation process must happen at a time when employee representatives can participate and provide input.

Employees have several rights during the TUPE process, including:

1. Preservation of terms and conditions: TUPE ensures that employees keep their existing terms and conditions of employment when they transfer to a new employer. This includes their pay, holiday entitlement, length of service, and other contractual benefits.

2. Protection against unfair dismissal: TUPE protects against unfair dismissal. Dismissals solely or mainly because of the transfer are automatically classed as unfair unless there is an ETO reason for the dismissal.

3. Collective consultation: Collective consultation requirements apply if 20 or more employees are affected. Current and new employers must inform and consult with employee representatives and provide details about the transfer, its effects, and any planned changes.

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The Consultation Process

The consultation process ensures that employees are well-informed and have a voice during the transfer. It involves communicating with employee representatives about the transfer, its implications, and any changes that might affect the employees.

Steps in the Consultation Process

1. Identify Representatives: Determine who will represent the employees. This could be trade union representatives or elected employee representatives.

2. Inform Representatives: Provide comprehensive information about the transfer. This includes:

  • The fact that the transfer is happening.
  • When it will take place.
  • The reasons for the transfer.
  • The legal, economic, and social implications of the transfer.
  • Any measures envisaged in relation to the employees (e.g., changes in working conditions).

3. Consult with Representatives: Engage in meaningful discussions with the representatives about the proposed measures. This means genuinely considering their input and attempting to reach an agreement where possible. The consultation should begin long enough before the transfer to allow adequate time for meaningful discussions.

4. Feedback and Updates: Keep employees updated throughout the process. Provide feedback on how their input has influenced the transfer and any decisions made

Legal Obligations and Penalties

Employers who fail to inform and consult adequately can face legal claims. If found in breach, the employer could be ordered to pay up to 13 weeks’ pay for each affected employee.

Common challenges and issues in the TUPE process

The TUPE process can be complex and challenging, with several common issues employers may face. These include:

1. Employee resistance and morale: Employees may feel uncertain or anxious about the transfer. This might lead to resistance or low morale. Effective communication and consultation can help address these concerns and maintain employee engagement.

2. Changes to terms and conditions: Changes to employees’ terms and conditions could cause challenges. Employers must ensure any proposed changes are fair, legal, and approved by current and new employers.

3. Redundancies: If redundancies are necessary due to the transfer, employers must follow fair and lawful procedures. On the other hand, dismissals solely or mainly because of the transfer are automatically unfair unless there is an ETO reason.

4. Time and resource constraints: The TUPE process requires careful planning, consultation, and coordination. Employers may need more time constraints or more resources. Good preparation and professional advice can help manage these.

What could be an ETO Reason?

  • Economic Reasons: These relate to the company’s profitability or market performance (e.g., financial constraints leading to cost-cutting measures).
  • Technical Reasons: Involve changes in the equipment or technology used in the business (e.g., automation reducing the need for manual labour).
  • Organisational Reasons: Concern about the structure of the business (e.g., restructuring leading to redundancies)
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What is the TUPE redundancy process?

Sometimes, if you’re taking over a service or acquiring a business, you most likely have the required teams already in place, which means you might not need all the employees to transfer. Whereas there might be other instances where it’s deemed better to outsource roles vs it being inhouse. This is where you could potentially end up in a position of having to make employees redundant.

1. Identify the Need for Redundancies: Establish whether redundancies are necessary for ETO reasons.

2. Consultation: Engage in a redundancy consultation process with affected employees. This involves:

  • Explaining the reasons for the redundancies.
  • Exploring alternatives to redundancy.
  • Considering employees’ suggestions to avoid or reduce redundancies.
  • Selecting employees for redundancy fairly and transparently.

3. Notice and Redundancy Pay: Provide affected employees with appropriate notice and redundancy pay per their contract and statutory entitlements.

4. Support for Affected Employees: Provide support for redundant employees, such as outplacement services, career counselling, and job search assistance.

How to avoid pitfalls

  • Clear Communication: Maintain clear and transparent communication with employees throughout the redundancy process to avoid people leaving during the transfer. You don’t want resource gaps!
  • Legal Compliance: Ensure all procedures comply with employment law and TUPE regulations.
  • Early 1-2-1 consultations: The earlier you engage in 1-2-1 consultations, the better. Following 1-2-1s, remember to solve any queries relating to the ELI data before you can issue contracts and onboard employees.

Tips for successful TUPE transfers

To ensure a successful TUPE transfer, employers can follow these tips:

1. Seek Professional Support: TUPE can be complex. It’s advisable to seek professional advice from employment law specialists or HR consultants. Experts like Empro Group can provide guidance on legal requirements, employee consultation, and best practices or even support you throughout the process.

2. Plan Ahead: Plan for the transfer well in advance to allow enough time for consultation and preparation. Identify key stakeholders, establish a timeline, and allocate resources accordingly. The earlier you can engage with the current employer, the better; this can help resolve any issues in time for the transfer. Engaging with the employees earlier can help to minimise unsettlement.

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3. Communicate Strategy: It’s a good idea to plan a robust communication strategy ahead of the process. This helps to maintain open and transparent communication with employees throughout. Your comms and engagement plan should allow you to provide regular updates, address concerns, and ensure that employees understand the implications of the transfer.

4. Involve Employees: Involve employees in the consultation process and allow them to provide input or raise concerns. This helps maintain employee engagement and establish positive working relationships with the new employer.

5.Consider Training and Support: Provide training and support to employees to help them adapt to any changes resulting from the transfer. This can include training on new systems, processes, or working practices.

Empro Technology

Empro's Project Horizon: Streamlining the TUPE Process

Empro doesn’t just support you through the TUPE process; we make it ten times more efficient with our advanced technology solutions through Project Horizon. You might be wondering, what is Project Horizon? Well, within six weeks of a transfer, you’re required to submit all the necessary documents. While this should ideally be done before the transfer, legally, you have up to six weeks post-transfer to complete this.

Thanks to our digital solution, this process is seamless. We’ve API-linked our system with one of the leading providers, allowing you to manage all document submissions through our app, which is available on Android and iOS. This integration ensures that you can handle everything digitally and efficiently.

But that’s not all. Project Horizon also offers comprehensive training and support. We can create custom training modules, quizzes, and knowledge bases to help your employees transition smoothly. You can customise these resources to your heart’s content. You may need details like uniform sizes or specific documentation. The app can also include an employee forum to keep your team engaged and involved in the process.

By choosing Empro Technology’s Project Horizon, you’ll not only comply with legal requirements but also empower your employees and enhance the efficiency of your business operation!

Key Features of Project Horizon

  • Digital Documentation: API-linked systems, available on Android and iOS, allow seamless digital submission and management of all required documents.
  • Custom Training Modules: Create bespoke training modules, quizzes, and knowledge bases tailored to the needs of transferring employees.
  • Employee Engagement Tools: Incorporate forums and communication platforms within the app to keep employees informed and engaged throughout the process.
  • Compliance and Efficiency: Ensure compliance with all legal requirements while enhancing the efficiency of your business operations.

Benefits of Using Project Horizon

  • Time-Saving: Automates and streamlines administrative tasks, reducing the time required for document management.
  • Enhanced Communication: Facilitates better communication and engagement with employees, ensuring they are well informed and supported.
  • Compliance Assurance: Helps meet all legal requirements, reducing the risk of non-compliance and associated penalties.
  • Centralised Data Management: Consolidates all employee and transfer-related information in one centralised system, making it easier to access, track, and manage data, thereby improving decision-making and operational oversight.

Conclusion and final thoughts

The TUPE process protects employees’ rights during business transfers or takeovers. Employers can ensure a smooth, fair, and legally compliant transfer by understanding and meticulously following TUPE regulations. Tools like Empro Group’s Project Horizon can significantly enhance the efficiency and effectiveness of the process, benefiting both employers and employees.

For further assistance or professional advice, consider consulting employment law specialists or HR consultants who can provide tailored guidance and support throughout the TUPE process.

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