TUPE- When does transfer occur?

Employers are advised to take precautions, or more importantly seek Support Line advice when dealing with TUPE.

It is a difficult point of law to understand at best, a view which has been reaffirmed by the House of Lords decision in Celtec v Astley & Others. In this case the effective date of transfer became a subject for debate.

The House of Lords ruled that the claimants' contracts of employment transferred to Celtec in 1990 when the Training Enterprise Council (TEC) opened for business.

This was irrespective of the fact that at the time the parties believed that the claimants remained employees of the Department of Education (DofE) but were on secondment to the TEC until 1993. Therefore, the employees were entitled to rely on their employment with the DofE from 1990 as being part of their continuous employment.

Practical impact:

This decision confirms that a TUPE transfer must take place on a specific date and not over an extended period of time.

Employees and employers cannot agree or arrange for the transfer to take place on a date other than the true legal date of the transfer.

If employees are transferred in stages to a new employer (as is often the case in outsourcing transactions), the precise point in time when responsibility as employer for carrying out the transferred business passes to the transferee will need to be determined, as this will be the date on which employees are deemed to have transferred.