Brain Food: Workplace Rights - Transfer talk

After years of agonising, the Government is reforming the law protecting employees' rights when the business for which they work changes hands. The legislation is known as TUPE - pronounced 'chew pea' - (Transfer of Undertakings (Protection of Employment) Regulations). The trouble began when TUPE was applied not just to business sales but also to organisations contracting out operations such as cleaning and catering, or subsequently changing their service provider. The inconsistent approach of the courts has caused confusion over the outsourcing scenarios to which TUPE applies.

TUPE 2, coming into force in October, is designed to encompass all 'service provision changes'. The DTI believes greater certainty will reduce disputes and transaction costs. But the draft regulations include exceptions, among which are contracts for supply of goods rather than services, and cases where clients buy in services from a contractor on a one-off basis. These could become new grey areas, provoking more litigation. Even more controversial is an exemption for professional business services such as accountancy on the basis that white-collar staff are 'less in need of additional legal protection' than those providing 'routine manual work'.

- Michael Burd and James Davies, Lewis Silkin solicitors, e-mail:

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