TUPE and Outsourcing: Process and Disputes
We regularly provide support to businesses being acquired or purchasing another business or part of a business through an asset sale which is a relevant transfer for the purposes of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).
A relevant transfer for TUPE purposes will also include where there is a service provision change, i.e. when a business engages a service provider to carry out services which had previously been carried out in-house, for example, their IT function or payroll function (“outsourcing”), when the business changes the provider of the outsourced services (“second generation outsourcing”) or when a business takes the services back in-house following an outsourcing (“‘insourcing”). TUPE applies to protect employees in these circumstances.
We have extensive experience in helping businesses navigate their obligations under the TUPE information and consultation process, advising on when it arises, when it is necessary to elect employee representatives, how and when to elect representatives and TUPE indemnities in the sale/transfer agreement or outsourcing agreement to best protect the business’s position. We regularly review outsourcing agreements in relation to TUPE incoming and exit provisions and the arrangements relating to the employees when there is a change of service provider.
