The Government has published the outcome of its consultation with regard the changes contemplated to the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).
The report sets out what changes will be made to TUPE in 2014. Fortunately, the Government has decided not to make changes to the "service provision charge" part of TUPE, which would have resulted increasing the uncertainty about how TUPE operates.
Other changes are helpful and broadly will be of assistance to employers. The main changes are as follows:
The Government will amend the TUPE Regulations to allow renegotiation of terms derived from collective agreements one year after the transfer, even though the reason for seeking to change them is the transfer, provided that overall the change is no less favourable to the employee.
The Government will amend TUPE to provide expressly for a static approach to the transfer of terms derived from collective agreements.
The Government will amend TUPE so that changes in the location of the workforce following a transfer can be within the scope of economic, technical or organisational reasons entailing changes in the workforce, thereby preventing genuine place of work redundancies from being automatically unfair.
The Government will amend Regulations 4 and 7 (restriction on changing contractual terms and protection against dismissal) to bring them closer to the language of the Acquired Rights Directive.
The Government will make an amendment to reflect the approach set out in the case law, namely that for there to be a TUPE service provision change, the activities carried on after the change in service provision must be "fundamentally or essentially the same" as those carried on before it.
The Government will amend the Trade Union and Labour Relations (Consolidation) Act 1992 to make it clear in statute that consultation which begins pre-transfer can count for the purposes of complying with the collective redundancy rules, provided that the transferor and transferee can agree and where the transferee has carried out meaningful consultation.
The Government will improve the TUPE process for micro businesses by allowing such businesses to inform and consult affected employees directly where there is no recognised independent union, nor any existing appropriate representatives.
The Government will retain the rules about employee liability information and extend the time before the transfer when it must be given to the transferee to 28 days.
The Government will work to improve TUPE Guidance.
For more information please contact Alan Julyan, Partner