At the close of 2011, the Government called for evidence on the effectiveness of the Transfer of Undertakings Regulations.
Following consideration of the evidence received, there will now be a period of ‘policy development and stakeholder engagement’, following which a consultation process will begin.
The responses to the call for evidence broadly reflected the following common concerns:
- Employee liability information (the information to be passed from old employer to new employee about the terms and conditions of each transferring employee) should be provided earlier than 14 days before the transfer;
- There is no provision for an employer to change terms and conditions of transferred employees in order to harmonise with existing staff post-transfer;
- The Regulations ‘gold-plate’ the Acquired Rights Directive because the Directive does not require service provision changes (transfers that occur when a service is contracted in, contracted out, or a contract changes hands) to be covered;
- There is uncertainty as to how the Regulations apply to pensions and to insolvency situations;
- Confusion over the approach to economic, technical or organisational reasons
In due course, the Government will consult on:
- Whether the 2006 service provision changes should be retained or repealed;
- Whether, generally, liability should pass entirely to the transferee as now, or be held jointly and severally by transferee and transferor;
- Whether employment liability information should be provided earlier to the transferee;
- Whether an amendment to TUPE would be possible to ensure that a change of location of the workplace following a transfer does not necessarily lead to automatic unfair dismissal i.e. it is capable of constituting an economic, technical or organisational reason entailing changes in the workforce.
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