TUPE

When a business changes owner, its employees may be protected under the Transfer of Undertakings (Protection of Employment) regulations (TUPE). There are two types of transfer TUPE protects: business transfers, including mergers where two companies close and combine to form a new one, and service provision changes, such as an in-house service being awarded to a contractor, a contract moving to a new contractor, or a contracted-out service being brought back in-house. Where TUPE applies, employees' jobs usually transfer to the new employer, their employment terms and conditions transfer, and their continuity of employment is maintained.

TUPE does not cover every change of supplier: employees are not protected where a contract is for the supply of goods for the company's use, or for a single event or short-term task, and only employees who can be clearly identified as providing the transferring service are protected. Under regulation 7 of the 2006 Regulations, an employee dismissed either before or after a relevant transfer is to be treated as unfairly dismissed if the sole or principal reason for the dismissal is the transfer, subject to a narrower exception where the real reason is an economic, technical or organisational reason entailing changes in the workforce.