The government has published its response to the TUPE consultation. Originally, we expected TUPE to be revised in October, but the changes are now not expected to come into force until January 2014. There are some important changes in the government response.
The key change is that service provision changes (SPC) are to survive. TUPE applies under the SPC banner essentially when a business outsources a service, brings it back in house or changes a service provider. In the consultation, the government considered removing SPC's and reverting to business transfers alone (as was the case pre-2006). It has now decided that such a move would cause greater uncertainty for businesses seeking to outsource a service as they could not be certain whether TUPE applied or not. Instead, the government will amend SPC rules to clarify that the activities carried on after the change in service provision must be 'fundamentally or essentially' the same as those carried on before it. This mirrors the position established under case law. Our view is that retaining SPC's is to be welcomed as the pre-2006 position caused greater uncertainty and associated costs for businesses seeking to outsource a service.
For guidance on what else has changed, have a look at the government response.
Petra Venton