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Changes to TUPE rules cut red tape for business

New reforms will mean that employers and staff in a business changing owner will find the transfer easier, fairer and more effective, according to the Government.

When a business changes owner, its employees may be protected under the Transfer of Undertakings (Protection of Employment) Regulations (TUPE). TUPE protections make sure that employees don’t unfairly lose out when a transfer takes place, and set out the rules that the old and new businesses have to follow.

In a response to a consultation on TUPE regulations earlier this year, the government is announcing that the laws will be improved to make sure both employers and staff are treated fairly when a transfer takes place.

The proposed changes include:

  • Allowing businesses to renegotiate terms and conditions provided for in collective agreements one year after the transfer provided that overall the change is no less favourable. TUPE protects employees’ terms and conditions and does not generally allow them to be changed by reason of the transfer. However, as an exception, the Acquired Rights Directive (which TUPE implements) gives scope for changes to terms and conditions, which are set out in collective agreements, from one year after the transfer.
  • Clarifying 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 won’t bind the new employer if it is neither a party to the subsequent collective agreements, nor takes part in the process for bargaining them.
  • Amending the rules so that where the place of work changes after the transfer, any redundancies due to that change will not be automatically unfair. This means that as a starting point businesses will not face possible unfair dismissal claims simply because of a change in location of the workplace.

According to the Government, it intends to lay the new regulations in Parliament in December 2013.

Contact Employment Law Edinburgh

For TUPE queries and other specialist employment law advice, click here to complete our enquiry form or call us on 0131 208 3459.

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