Tupe Plus Agreement

Before we look in detail at the TUPE plus regime, we should remember some of the most important provisions of the 2006 Business Transfer Regulation (“TUPE”). The TUPE is applicable to protect the rights of workers in the event of a transfer of an enterprise when an economic entity that retains its identity is transferred. It is not necessary for an economic entity to be profit-oriented and the definition would encompass many functions performed in the public sector. A new type of TUPE transfer was introduced by the 2006 Regulations. With some exceptions, TUPE generally applies when a client appoints a contractor to work on its behalf, re-engage such a contract or bring the work back in-house (a “performance modification”). A key question is whether the service or activity that constitutes the service will be maintained. The contracts of the Alemo-Herron version clearly stipulated that the terms and conditions of employment in force at all times were those set by the NJC. Although this meant that the payment was decided at a forum that the private contractor was not able to control, it does not differ conceptually from a provision that links wage increases to another external benchmark, such as inflation. According to this analysis, collective agreements concluded after the transition have an impact on the worker and the worker only if the contract so provides. Without such a clause in employment contracts, the new collective agreements would not be relevant. The main source of guidelines for TUPE plus is the Cabinet Office Statement of Practice on Staff Transfers in the Public Sector (revised 2007) (“COSOP”) which states, inter alia, that when a public body outsources, or in the case of transfers between different parts of the public sector in all exceptional circumstances, staff should change on the basis of the application of TUPE, even if tupe is not strictly applicable by law. Its main application concerns central government departments and authorities and the NHS (and the local authorities where they were adopted), but it has never had legal force. The obligations of local authorities in the event of a transfer of TUPE are no longer very clear; TUPE plus was significantly eroded, but was not completely removed.

In any future outsourcing situation, a local authority risks being put in the crossfire between potential contractors and trade unions. On the one hand, potential contractors should be reluctant to bear costs that provide generous employment benefits that go beyond the normal TUPE requirements. On the other hand, it is likely that unions will insist that TUPE Plus be fully protected, or as close as they can realistically for their members. Any such situation is likely to require careful handling in order to minimise potential risks and, where necessary, legal advice should be used. The application of the Business Transfer Regulation (“TUPE”) to public sector transfers in 2006 was generally referred to as “TUPE plus” because it was more burdensome for employers and offered more protection to employees than the normal TUPE requirements. In line with its objectives of opening up public procurement and reducing costs, the coalition government has gradually called for the withdrawal and dilution of a large part of the TUPE Plus regime. In its current form, the scheme has not been completely repealed, so local authorities are not clear as to the extent to which TUPE plus should be taken into account in decisions on the allocation of services to external providers. The good news is that a legislative solution could be in the Committee. . . .