Government consultation on changes to TUPE and abolishing European Works Councils

The Government has launched a consultation on plans to change the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE). It also plans to end the legal framework for European Works Councils.

The consultation, which runs until 11 July 2024, seeks views on the following changes:

• To clarify that TUPE should only apply to employees not to workers. In its present form, TUPE is stated to apply to ‘employees’ but its definition of ‘employee’ is looser than that contained in Employment Rights Act 1996and other UK employment legislation. This led to the 2019 tribunal case of Dewhurst v Revisecatch Ltd which held that TUPE would also catch workers. Although this decision, being one at first instance, is not binding on future cases, the Government proposes to clarify the position.

• To confirm that if a business transfers to multiple buyers, the assigned employees cannot have their employment split between them (as the European Court of Justice had held in ISS Facility Services NV v Govaerts). Full employment of a given employee must transfer to one transferee. The Government’s proposal is that, going forward, transferees would be required to agree who should take on each employee. This proposal marks a change from the UK's pre-Govaerts position. Before, the transferee who took on most of the transferring service would get all the assigned employees (Kimberley Housing Group v Hambly). It is unclear how this part of the proposal would work in practice.

• To abolish the legal framework of European Works Councils in the UK. Works Councils are consultative bodies representing the European workforce in multinational organisations. Following Brexit, the Government legislated to prevent any new Works Councils being formed. They now propose to allow those already in existence to be disbanded.

Thanks to Daniel Barnett.