Transfer law

This month’s cases include decisions on the factors determining whether there has been a TUPE transfer.

The key developments

* TUPE does not apply where there is a one-off, single contract of limited duration (case 1).

* An award for failure to consult under TUPE should be calculated in the same way as a protective award for a failure to consult over collective redundancies (case 2).

* A tribunal must consider many factors, including the fate of the employees, when deciding whether there has been a transfer (case 3).

* Details of a transaction between one business and another are not enough to determine whether there has been a TUPE transfer (case 4).

The basic legal rules

Under the transfer regulations (TUPE), when a business is transferred from one employer to another, the employees doing the work should also transfer on their existing terms and conditions. To come within TUPE, there has to be a relevant transfer of an activity that amounts to a “stable economic entity”.

The employer before the transfer is referred to as the “transferor”, and the employer to whom the business transfers is the “transferee”.

Under TUPE, most legal liabilities (such as outstanding legal cases being taken against the transferor) transfer to the transferee.

An employee covered by TUPE has the right to continued terms and conditions, including redundancy terms. There is no time limit on TUPE protection, but this does not mean that changes to transferred employees’ terms and conditions can never occur.