TUPE

The Transfer of Undertakings (Protection of Employment) Regulations (TUPE) protects employees' terms and conditions of employment when a business is transferred from one owner to another. Employees of the previous owner when the business changes hands automatically become employees of the new employer on the same terms and conditions. It's as if their employment contracts had originally been made with the new employer. Their continuity of service and any other rights are all preserved. Both old and new employers are required to inform and consult employees affected directly or indirectly by the transfer.

TUPE applies when an undertaking or part of it is transferred from one employer to another, eg:

+ Where all or part of a sole trader's business or partnership is sold or
  otherwise transferred
+ Where a company, or part of it, is bought or acquired by another (if the
  second company buys or acquires the assets and then runs the business
  rather than acquiring the shares only)
+ Where two companies cease to exist and combine to form a third
+ Where a contract to provide goods or services is transferred in circumstances
+ which amount to the transfer of a business or undertaking to a new
  employer.

TUPE can apply regardless of the size of the transferred undertaking, ie from large organisations employing thousands of employees to small businesses like a village shop with one assistant.