The Transfer of Undertakings (Protection of Employment) Regulations 2006 are a very important protection for employees of businesses (or parts of businesses) that are taken over or for services that are outsourced.

Originally based on European law, these regulations require that employees must be informed and consulted if the business or undertaking for which they work is transferred to a new employer; and that their terms of employment must not, in normal circumstances be changed adversely. Generally there will need to be representatives elected with whom the employer will consult about any changes it intends to make.

In practice very often a new employer or service provider will seek to make changes to the workforce. This can be done if the changes are necessary for an economic technical or organisational reason.

If you are purchasing a business or a contractor to which a service is being outsourced, you will need to look at the existing employment liabilities extremely carefully as you will be inheriting all the employment related liabilities that existed even before you take over, and if you then seek to change any employees‘ terms of employment to their detriment, they may be automatically entitled to claim that they have been unfairly dismissed by reason of the transfer of the business for they were working.

If you are an employee who is adversely affected by a change in ownership of your business or service provider, we can assist you during any consultation process and with any redundancy or other result following the change in business operator.