Proposed Changes to TUPE

The Government has published its response to the consultation on proposed changes to the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).

Significantly, service provision changes will continue to qualify as relevant transfers for the purposes of TUPE. Amendments will be made to take into account recent case law, namely that for there to be a TUPE service provision change, the activities carried on after the transfer must be ‘fundamentally or essentially the same’ as those carried on before it.

In addition, as regards the transferee’s obligations when there is a collective agreement in place in respect of employees acquired as a result of a TUPE transfer, following the decision of the European Court of Justice in Alemo-Herron and others v Parkwood Leisure Limited, the Government proposes to amend TUPE to provide expressly for a ‘static’ approach in such circumstances and set a limit of one year during which collective agreements negotiated pre-transfer will continue to bind transferees. After that time, terms of employment will be able to be renegotiated provided the changes are no less favourable to employees.

The changes are scheduled to take effect in January 2014.