Transfer of Undertakings (Protection of Employment) Regulations 2006 transfer

In certain circumstances, an employer can ‘acquire’ employees when there has been a ‘relevant transfer’ of a business or undertaking, or part of it, to a new employer. 

The Transfer of Undertakings (Protection of Employment) Regulations (commonly known as TUPE) safeguards employee’s rights when there has been either:

  • a transfer (not necessarily by sale) of all or part of a business or undertaking if that ‘economic entity retains its identity’, or
  • a ‘service provision change’ (contracting-out by a ‘client’, change of contractors after retendering, and contracting-in by a ‘client’), where the service is provided by an ‘organised grouping of employees’.

Transfers by acquisition of shares are normally excluded, because there is no change in the legal personality of the employer.  However, actions by the new owner of the shareholding might result in a TUPE transfer in certain circumstances.