Is it breaching TUPE regulations?
Many employers, their HR teams and their lawyers have considered that when employees have been transferred to them under TUPE, that it is impossible to change the terms and conditions of the transferred employees, without risking breaching the TUPE regulations.
As with many situations, life is not that simple and both recent case law, as well as the statutory change in 2014 to the regulations, have opened the possibility of effecting change, without breaching the regulations.
If the change, for example the need to unify operating procedures, or the introduction of a new incentive scheme is due to commercial and business reasons, as opposed to being due to the transfer itself (from an old employer to a new one), then this does not breach the TUPE regulations. This is also the case in respect of a dismissal.
Employment Appeal Tribunal
The error that is often made is to consider that the change in terms or a dismissal would not have occurred ‘but for’ the transfer. The Employment Appeal Tribunal clarified this is the wrong criteria by which to judge the changes or the dismissal and they said so as long ago as 2011, in the cases of Smith v. Trustees of Brooklands College and later in Enterprise Managed Services v. Dance.
When the new 2014 Regulation 7 was introduced, this further widened the scope for employers to argue that the changes needed, or the dismissal itself, was not primarily due to the transfer under TUPE, but required for other commercial or business reasons. The employer will however, need to be confident that they have sufficient evidence to support this line of argument.
ENDS JUNE 2018
About The Author: Richard Keen
Richard acts for employers and employees across a wide range of employment disputes. He has acted for senior executives in disputes over termination payments, share options and bonuses, as well as for employers helping them to manage redundancies and disciplinary matters.
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