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TUPE means nothing to most people, but it is a very important protection for employees when their employer changes hands.

TUPE stands for the Transfer of Undertakings (Protection of Employment) Regulations. These Regulations impose upon transferors and transferees of businesses certain duties and responsibilities regarding their employees.

If you work for company A, the terms of your employment are with company A. Before the Regulations, if company A transferred its business to company B, your employment would end at transfer and it would be up to company B if they took you on, and the terms they offered you.

TUPE applies to most business transfers and requires that employees of company A transfer to the employment of company B under the same terms and conditions (e.g. pay, holiday, overtime etc) and with continuity of employment. This means that if you have been working for company A for five years, you keep that length of service and any rights that go with it, and carry it over to company B.

Companies A and B have duties to inform the employees of both their organisations of their intention to make a transfer. They also have duties to consult any employees who may be affected by the transfer of the business. If employees are not properly informed or consulted then they will be able to bring a claim in the Employment Tribunal for compensation of up to 13 weeks pay.

If an employee is dismissed because of the transfer, or a reason connected with the transfer, then this will be an automatically unfair dismissal. An employer may have a defence to such a claim if it can show a valid reason under the Regulations for making dismissals.

TUPE also covers the employees of sub-contractors. So, for example, you work for a cleaning company which has a cleaning contract with a hospital. If the hospital terminates the cleaning contract, and gives the contract to another cleaning company, your employment should be transferred to the new cleaning company. Using the same example, the same would apply if the hospital’s own staff had been doing the cleaning, and the work was sub-contracted out for the first time. Also, if the hospital decided no longer to sub-contract but to take the cleaning work back in house, TUPE would apply.

This is a very complex area of employment law and this has only been a very brief overview. If you need any advice on your rights under TUPE please contact Marina Vincent on 020 8422 5678.

Contact Harold Benjamin employment lawyers team for employment law in London and Nationally.