13th April 2017

TUPE – Employee Liability Information

Regulation 12 of the TUPE Regulations 2006 gives rise to a rare situation where Employer A can sue Employer B in the employment tribunal.

Employee Liability Information (“ELI”) – the law

Where a TUPE transfer takes place (be that a business transfer or a service provision change – change of contractor), the outgoing employer is obliged to provide the incoming employer with certain pieces of information about the transferring employees. This information must be supplied at least 28 days prior to the transfer and is known as employee liability information. The required information includes “those particulars of employment that an employer is obliged to give to an employee pursuant to section 1 of the 1996 Act.” These duties are imposed by TUPE Regulation 11.

Consequences of non-compliance relating to ELI

TUPE Regulation 12 allows the incoming employer in a TUPE situation to raise a claim against the outgoing employer for any failure by the outgoing employer to comply with Regulation 11. The remedy for such an action can include compensation of up to £500 per employee in respect of whom the failure applies.

The recent case

Reported cases of this nature are rare. However the recent decision in Born London Limited v Spire Production Services Limited is one such case and one which throws up an “interesting” result/warning for those businesses inheriting employees under TUPE. Very briefly, the outgoing employer (Spire) told the incoming employer (Born) that Christmas bonuses were non-contractual. After the transfer the employees alleged that the bonuses were contractual. Born raised proceedings alleging that this inaccurate disclosure by Spire was in breach of Regulation 11. They were unsuccessful on the basis that while Regulation 11 does require disclosure of the statement of particulars of employment, within that statement of particulars can be contractual and non-contractual matters. Accordingly, it did not follow that referring to something as non-contractual which was in fact contractual amounted to a breach. Essentially, the branding of something as “non-contractual” is additional information beyond the scope of what is required by Regulation 11.

What can we take from this case?

Firstly, the case did not produce a satisfactory result in the sense that the outgoing employer provided, on the face of it, untrue information to the incoming employer but the incoming employer was not protected by Regulation 11. Secondly, and perhaps more importantly, the case emphasises the importance of carrying out thorough due diligence when inheriting employees under TUPE. If there is contractual documentation in place regarding the transfer, the incoming employer should insist on appropriate warranties/indemnities to protect against such anomalies.

If you are acquiring employees from another business, take advice.

Jack Boyle 
Associate – Employment Law
@EmpLawyerJack
www.blackadders.co.uk

 

 

The opinions expressed in this site are of the author(s) only and do not necessarily represent the opinions of Blackadders LLP.

Blackadders takes all reasonable steps to ensure that the content of this site is accurate and up to date. The site is not, however, intended as a substitute for seeking legal or other professional advice but rather as an informative guide to the services provided by Blackadders and topical legal developments. Site visitors should always seek advice tailored to their specific situation. Consequently, Blackadders accepts no responsibility for any loss or damage suffered by anyone acting or failing to act on the basis of information contained on this site. Downloading of material contained on this site is at the user’s own risk and all necessary virus checks must first be carried out by the user. Blackadders is not responsible for the material found on any web sites linked to this one and links to this site may only be made with Blackadders prior consent.

Copyright

Blackadders owns the copyright in this blog and all material contained on it. The material on this site may be downloaded for personal use only and must not be altered. Otherwise, Blackadders’ written consent is required before any material on this site is reproduced, copied or transmitted in any way.

Privacy Statement

Information passed to us via this site is kept confidential and will not be disclosed to third parties except if authorised by you or required by law.

© Blackadders LLP 2011

Members of the Law Society of Scotland. Authorised to conduct Investment Business under the Financial Services & Markets Act 2000 by the Financial Services Authority.

Blackadders Solicitors is a trading name of Blackadders LLP, a limited liability partnership, registered in Scotland No SO301600 whose registered office is 30 & 34 Reform Street, Dundee, DD1 1RJ. Reference to a ‘partner’ is to a member of Blackadders LLP.

Back to News & Legal Updates