A look at TUPE law in Ireland. TUPE deals with the protection of employees' rights when there is a transfer of an undertaking, for example a change of contract/service provider or transfer of a business or part of a business. Learn more about employment law in Ireland: http://employmentrightsireland.com

1. TUPE
TRANSFER OF UNDERTAKINGS IN IRISH LAW

2. TUPE-WHAT IS IT?
• Protects employees in transfer of undertakings situations
• What’s an undertaking?
• No one definition, but it is an “economic entity” and can be any one of…
• A business, part of business, schools, colleges, educational institutions, charities,
local authorities, health boards, trade associations, trade unions, State and semi-
State bodies

3. TUPE LAW IN IRELAND
• S.I. No. 131/2003 - European Communities (Protection of Employees on Transfer
of Undertakings) Regulations 2003 is critical
• Also: Employees (Provision of Information and Consultation) Act 2006

4. TUPE IN A NUTSHELL
• The rights and obligations in respect of employment contracts of the transferring
business are transferred to the new business
• Employee and trade union contractual entitlements survive post transfer regardless of
whether the purchasers is aware of these entitlements or not
• Underlying philosophy is if similar activities are continued in different hands the
identity of the undertaking remains, a transfer occurs, the employees follow the work
and protection is enjoyed by the employees.
• Pension rights do not transfer
• Tupe does not arise where the transfer of business is by way of share sale

5. TRANSFER OF UNDERTAKING
• There must be a transfer of undertaking
• The key criterion in deciding whether there is a transfer within the meaning of the
regulations is whether the activity is seen to be continuing, even with some
differences or even where all of the economic activity has not transferred
• Therefore, transfer of part of a business is covered
• A “mere activity”, as opposed to a part of an undertaking, is not covered
• Voluminous case law in Europe as to whether TUPE applies

6. CAN EMPLOYEES AGREE CHANGE BEFORE
TRANSFER?
• Only if the change is an improvement
• Regulation 9 prevents any “contracting out” of an employee’s rights

7. SI 131/2003
• Regulation 4 deals with rights and obligations
• Regulation 5 deals with dismissals and termination of employment
• Regulation 6 deals with bankruptcy/insolvency
• Regulation 7 deals with representation of employees
• Regulation 8 deals with consultation and provision of information
• Regulation 9 deals with agreements
• Regulation 10 deals with complaints

8. PENALTIES
• Breach of regulation 8 (consultation and information): up to 4 weeks’
remuneration
• Breach of other regulations: up to 2 years’ remuneration

9. THE ETO DEFENCE
• Dismissals arising from a transfer of an undertaking are permissible provided they
are done for economic, technical or organisational reasons.
• This is known as the ETO defence-similar to redundancy
• Transferee will be liable for redundancy payments

10. DOES EMPLOYEE HAVE TO TRANSFER?
• No, but he/she is not entitled to redundancy
• Employee is deemed to have resigned

11. SERVICE PROVIDERS-DOES TUPE APPLY?
• 2 scenarios:
1. Company decides to contract out an activity eg catering, cleaning, security for
the first time (first generation transfer)
2. Change of service providers-new winner of contract (second generation
transfer)

12. DOES TUPE APPLY?
Remember: TUPE applies to transfer of undertakings, not a transfer of a mere activity
The particular circumstances of each case will determine whether TUPE applies or not
• Have assets/resources transferred?
• Have employees transferred?
• In an asset intensive undertaking TUPE may not apply if it is only employees who
transfer, and not assets, either tangible or intangible.
• In a labour intensive undertaking, for example security or cleaning, if the transferee
refuses to accept the majority of employees then TUPE will probably not apply.

13. PROBLEMS FOR TRANSFEREE
• Need to consider:
• taking on new staff, and the associated costs
• Ensuring that the new staff taken on maintain their existing terms and conditions,
and having to deal with any friction which may arise with your existing workforce
in circumstances where the new arrivals may have better terms and conditions
• Taking on new costs associated with the transfer of employees, for example the
cost of carrying out redundancies, if necessary
• Negotiate an indemnity, if possible

14. TENDERING FOR A TUPE CONTRACT?
• Look closely at the terms and conditions of the employees, if you have to take
them on
• Carry out an audit, raise queries
• Check for any hidden liabilities, for example claims from employees against the
transferor. These claims will transfer to you with the TUPE transfer
• Negotiate the best indemnity (ies) you can to protect you against liabilities post
transfer

15. TERRY GORRY & CO. SOLICITORS
• http://BusinessAndLegal.ie
• For more information about employment law:
• http://EmploymentRightsIreland.com
• 046/95 49 614
• Main Street, Enfield, Co. Meath
• terry@terrygorry.com
• terry@businessandlegal.ie