Two areas have been flagged for possible changes in the future. There are “calls for evidence” on both TUPE and redundancy consultation processes.
Under the current Regulations TUPE places an obligation on both the transferor and transferee to provide information to, and to consult with, the representatives of their respective employees who may be affected by the transfer.
This can include employees who are not part of the transfer, but who are affected by the transfer.
TUPE also has the effect of transferring trade union recognition agreements, as long as the transferring group of employees maintains a distinct identify from the rest of the transferee’s business.
The transferor and transferee must inform and consult the recognised trade union. If there is no recognised trade union, the employees must be given the opportunity to elect their own representatives.
The following information must be provided in writing long enough before the proposed transfer to allow meaningful consultation to take place:
- – the fact that the transfer is to take place;
- – approximately when it is to take place;
- – the reasons for it;
- – the legal, economic and social implications for any affected employees;
- – the measures the employer envisages it will take in relation to the employees in connection with the transfer (or indicating that no such measures are envisaged): and
- – the transferor must give information as to the measures the transferee envisages it will take (this involves the transferee giving the necessary information to the transferor).
All affected employees are entitled to consultation when redundancies are contemplated. The consultation should start as soon as possible once redundancies are likely. There are special minimum consulation periods for collective redundancies: 30 days for 20 or more employees and 90 days for 100 or more employees, in either case when the redundancies are envisaged to take place within a 90 day period. Failure to adhere to the requirements for consultation can result in employees becoming entitled to a protective award. Late notification is also an offence which carries a fine of up to £5,000.
At the start of the consultation, employers must provide written details of:
- – the reasons for redundancies;
- – the numbers and categories of employees involved;
- – the numbers of employees in these categories;
- – how you plan to select employees for redundancy;
- – how you will carry out redundancies; and
- – how you will work out redundancy payments.
Consultation does not have to end in agreement, but it must be properly carried out with a view to reaching agreement, including ways of avoiding the redundancies or reducing their effect.
The first proposal is to focus on how effective the regulations are, and whether they are overly bureaucratic and generally “gold-plated”. While the call is not restricted to the specific questions raised, particular areas where evidence is sought include whether the extension of TUPE to service provision changes in 2006 has helped clarify the position on these and cut down the need for legal advice. Other areas of focus are the interplay with other areas such as redundancy consultation and the application of TUPE in insolvency situations.
The consultation on redundancy consultation concentrates on whether the set periods for consultation should be changed to reflect the “increase in the pace of decision-making” since 1975 when these provisions were first introduced – without taking away the requirement that consultation should start “in good time”.