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TUPE consultation- Government publishes it's response

30th September 2013
The Transfer of Undertakings (Protection of Employment) Regulations 2006 provides protection and preservation of the terms and conditions of employment of employees whose employment is transferred from one business to another, usually on the sale of their employer's business as a going concern to a different business. Since the TUPE Regulations 2006 came into force there has also been protection given to staff working on a service contract when that contract is taken over by a different business. However, the Government has expressed its intention to change the Regulations in order to make them easier for business to operate, and to remove the "goldplating" in the TUPE Regulations 2006 which extend protections beyond the strict requirements of the European Aquired Rights Directive- which is the European Directive that underpins TUPE.
The result of the Government's concerns was the launching of a consultation about the Regulations. The Government has recently published it's response to that consultation process.
The Government had indicated that it would repeal the service provision  change from the list of forms of relevant transfers. The practical problem with such a decision would have been the fact that the law on this area would have reverted to the provisions that applied before the 2006 Regulations were introduced. That would have resulted in significant uncertainty to businesses in competitive tendering processes, as the old case law did not always provide certainty as to whether or not the staff employed on such a contract were transferred when that contract moved from one business to another. The Government has decided that the service provision transfer rules will remain. Tranferors will therefore still be required to provide information on their employees allocated to the specific contract to the incoming employer (transferee). The Government has decided tha the period for providing that information should be extended to 28 days before the transfer.
On the issue of consultation with affected staff, the Government has decided that the regulations should be changed to enable small business to engage in direct consultation with the effected employees rather than have to go through a process of consulting with representatives of those staff (which can alos involve the process of election of staff representatives).
In addition the Government is proposing enabling a transferee to renegotiate terms agreed from collective agreements one year after the transfer, so long as they are no less favourable to the employees. This ability to renegotiate iss effectively prohibited in the TUPE 2006 regulations.
Rather than reduce the scope or effect of the Regulations, the Government's proposals seem to be quite practical and address some of the regular concerns of businesses involved in TUPE situations, particularly small businesses and their obligations in dealing with employee information and consultation with effected staff.
No implementation date has been specified for the proposed changes, but it has been suggested that this may take place in January 2014.
If you need any further advice on the matters raised in this article do not hesitate to contact us at Hallett Employment Law Services Ltd.            
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