TUPE (transfer of undertakings)
— the UK’s TUPE and the EU’s Acquired Rights Directive — transfers employees automatically when a business or service changes hands: same terms, preserved continuity, dismissal protection connected to the transfer. It binds share-free asset deals, outsourcing, insourcing and provider switches.
Where transfers bite in practice
Scope is wider than M&A: outsourcing a function, changing service providers or bringing work in-house can transfer the assigned workforce with their terms — including terms the new employer never designed. Information and consultation duties precede the transfer; transfer-connected dismissals are automatically unfair except for genuine economic-technical-organisational reasons.
Deal practice: due-diligence the inherited terms (pensions partially excepted), plan harmonisation within legal limits (post-transfer changes for transfer reasons are void), and price the workforce into the transaction. Service-provider changes in payrolling and staffing chains regularly trigger the rules — worth checking before switching vendors.
FAQ
Does TUPE apply when changing an outsourcing provider?
Frequently yes — service-provision changes are expressly covered in the UK, and EU case law reaches organised groupings of workers dedicated to the service. The incoming provider inherits the assigned staff on existing terms; pricing bids without workforce data is how providers get hurt.
Can transferred employees be dismissed or changed?
Dismissals and detrimental changes because of the transfer are protected against — void or automatically unfair — while genuine restructuring for independent reasons remains possible with normal process. The safe sequencing is: transfer clean, then restructure on documented business grounds.