New TUPE Regulations published

The new, and long-awaited TUPE regulations, the Transfer of Undertakings (Protection of Employment) Regulations 2006 have just been published. 

These will replace the Transfer of Undertakings (Protection of Employment) Regulations 1981, and will come into force on 6 April 2006.

Some of the headline changes are:

• ‘Service provision changes’ (which typically include the contracting out (or in) of services, or the replacement of one contractor by another), will now be clearly within the scope of TUPE
• There will be an obligation on the old employer to provide the new employer with 'employee liability information' at least a fortnight before the transfer. This will be in writing or readily accessible form and will include such information as the identity and age of employees, their terms and conditions of employment and recent disciplinary record, proceedings that an employee has, or is likely to bring and any collective agreement which will have effect after the transfer. The proposal in the draft regulations has been changed in the final version, replacing a requirement to disclose all employee liability information with a specific list, and changing the penalty for non-compliance from £75,000 in the High Court to a minimum of £500 per employee in the Employment Tribunal (with a discretion to award less)
• Much of the case law that has developed since TUPE first came into force in 1981 will be given statutory force
• Where employees transfer to a new employer, variations to their contracts of employment will be void, unless
  • the principal reason for any variation is an economic, technical or organisations reason entailing changes in the workforce (this is a very minor change given that ‘entailing changes in the workforce’ means changes in the numbers and functions of employees, which will exclude many exercises to harmonise terms and conditions following a transfer); or
  • the old employer is insolvent, and either the old or the new employer agrees all variations with the appropriate representatives of the employees (i.e. a trade union or elected employee representatives

• Where the old employer is insolvent, liability for certain categories of payments to its employees will not transfer to the new employer, but may be claimed from the government, subject to a statutory cap. Payments outside these categories, and above the statutory cap will, however, transfer
• Both old and new employers will be liable for failure to inform and consult with a trade union or employee representative

The new regulations can be accessed via this link:  

http://www.opsi.gov.uk/si/si2006/20060246.htm