Great. That’s something we can take care of for you. If your employees (or some of them) are about to have a different business employing them and new payroll arrangement and changes to tax details are involved, you’re in the right place.
There are quite a few rules here and most of them are unavoidable but we’ll keep it straightforward. If you’re following our process checklists and communications guidance, you shouldn’t find it too much of a chore or a drain on your productivity. Employees will feel confident that you’re looking after them and they’ll understand what’s happening and how it affects them, reducing the risks of complaints or anxiety.
Whether your need to transfer employees from your business is triggered by a group reorganisation, the acquisition or sale of a business, a change of contractor on a commercial contract (common with outsourcing or insourcing relationships), these rules apply.
The rules normally also apply in cases where you lose a service contract and the workers who have been servicing that contract are to be transferred elsewhere. But they normally don’t apply to an employee or employees who choose to change employer for their own reasons, or who are seconded or where there is a purchase of a business by share transfer only.
There are a few occasions when the rules might apply but then again, they might not. Taking advice in these situations can make a real difference to your risk of successful employee complaints against you. Typically, these situations cover where:
The business taking on the employees doesn’t know about the rules and/or refuses to follow the right legal process
The employees being transferred don’t form a clearly identifiable group of individuals to which it’s clear the rules apply, or
The new employer intends to/does operate so differently from your business that the rules don’t apply
We’ll help you navigate through these scenarios. A good rule of thumb however is to agree upfront with the new employer that you’ll both err on the side of caution and follow the rules.
In the long run, it will generally be a lot less costly and disruptive than risking employee complaints, tribunal actions and a potential derailment of the transfer altogether if as a result of all the hostility, the new employer suddenly backs out.
Of course, where the new employer refuses to agree to apply the rules, then you may find that the employees who consider they should have been transferred take the option of asking an employment tribunal to determine whether the rules apply (to see if they can get compensation from you and the new employer).
This is a rather nuclear solution, both in terms of your relationship and negotiations with the new employer and also for the employees, who are left with great uncertainty about their future job security - an outcome that commonly triggers the complaints about whether the rules apply.
If you find yourself in a position where the application of the transfer rules isn’t clear, we’ll recommend action to ensure that you and your business can fully assess and manage the risks - particularly if the new employer is being uncooperative.
So what are these rules? The law that governs employee transfers is called the TUPE Regulation, (you’ll hear it pronounced ‘Two-pee’ by people familiar with it). It’s designed to protect employees where their job continues to remain necessary but there’s about to be a change in the identity of the business that they have been working for and that is legally responsible for employing and paying them.
Both the existing and the future employer are affected by the rules and both will be required to take defined steps and follow legally mandated processes during the transfer phase. Here, we’re dealing with the impact on you as the existing employer who is doing the transferring.
Finding out that you’re being transferred can unsettle even those employees who in fact face minimal changes to their daily working experience. For those facing more significant alterations, such as a change of location or a change of reporting structures and senior personnel, the intended transfer can provoke distress, complaints and challenges.
We’ll equip you to ‘line up the ducks’ and be tough with the new employer if necessary, so you can do your best to reassure your employees and give them confidence that their interests are being properly looked after right up to the point of the change.
There are formal preparatory steps that you’ll need to take at least 28 days in advance of any transfer being made. You’ll be ready for these steps with our help. A large part of your success in avoiding problems will be how well you prepare, the way that you communicate to the affected employees and respond to their early reactions and the way you handle relations with the new employer. You’ll have our well-tested, experienced support whenever it’s required.
On this page we’ll show you exactly what’s involved in each stage of a typical employee transfer process where the TUPE rules apply and how long you should expect each stage to take.
(Transfers of employees to businesses outside the UK are not covered here. If you’d like us to help you with this, do get in touch and we can talk you through it).