Transfer of business (TUPE)

Your rights are protected if another employer takes over your current employer’s business under a legal merger or transfer.

This protection applies whether the entire business is sold or only the department or area where you work. For example, if your employer transfers its customer service department to another company, you are still protected.

The law covering transfer of undertakings

The law that applies is the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003.

An undertaking can be a business, a charity or a non-profit organisation.

A transfer of undertakings (also known as TUPE) is when employees are moved to a new employer as part of a legal merger or the sale of a business.

For a transfer of undertaking to take place, the following conditions must be met:

• There must be a change in the entity (either an individual or a company) responsible for managing the business.
• The new employer must continue the previous economic activities of the business.
• The business must be transferred as a "going concern".

What does not count as a transfer of undertakings?

Compulsory liquidation

Compulsory or involuntary liquidation of the business means that the business is forced to close by the courts. This does not count as a transfer of undertaking under the Regulations.

Service changes

A change of contractors is not a transfer of an undertaking. So, if a new service contractor takes over a contract from your employer, you generally won’t have the right to transfer to the new contractor under TUPE.

Service contract changes are common in contracts for office cleaning, catering, or security.

TUPE applies to the following types of workers:

• Employees
• Apprentices
• Agency workers
• Civil servants or state employees

The legislation covers a business, charity, or a non-profit organisation.

Your employment rights are protected under TUPE.

Contract of employment

Your new employer is legally obligated to take on the existing employees of the business. They must maintain the same terms and conditions, except pensions (explained below).

This means that the terms and conditions in your employment contract and your employer’s obligations, automatically transfer to your new employer.

If there is a collective agreement in place, for example, on shift arrangements or overtime) your new employer must continue to keep to its terms and conditions until it either expires or is replaced.

A transfer of business does not break your continuity of service for redundancy legislation purposes. Instead, it carries over to your new employment.

Pension rights

Employee pension rights in relation to old age, invalidity, or survivor benefits generally do not transfer to the new employer.

If you have an existing occupational pension, it may not continue in the same way. This means the new employer is not obligated to make the same pension contributions on your behalf. However, any entitlements you have built up before the transfer must be protected by the new employer.

If your previous employer offered entitlements similar to pension schemes, such as a lump sum entitlement on dismissal before retirement, the new employer must ensure that those rights are protected and continue.

It’s important to note that pensions under TUPE law can be complex, and you may need to contact the trustees of your pension scheme or get legal advice for more guidance.

Dismissal

The transfer of a business (or part of it), does not automatically give your employer the right to dismiss you.

However, your employer can end your employment if they have justifiable economic, technical, or organisational reasons.

Whether these reasons are justified will depend on the specific circumstances of each case. If you disagree with the grounds for dismissal, you can claim for unfair dismissal - see 'How to complain about a TUPE' below.

Unfair dismissal

If your employment contract is terminated due to a transfer that substantially worsens your working conditions, your employer is considered responsible for the termination.

For example, if your new employer cuts your wages leading you to resign, your new employer is held responsible for not honoring your employment contract.

You have a right to be informed and consulted by your employer on issues directly affecting you. This right is set out in the Employees (Provision of Information and Consultation) Act 2006.

Employers must inform and consult employees on any decisions likely to lead to substantial changes to work organisation or contractual relations.

Employers with at least 50 employees must engage in this process and consult with employees’ union or, if no union exists, with chosen employee representatives.

Information you must get

You or your union must get the following details of the transfer:

• The reasons for the transfer
• The date or proposed date of the transfer
• An assessment of the legal, economic, and social implications for the employees

If you are part of a union, the union must get this information no later than 30 days before the transfer.

If you are not part of a union, you must get the information in writing from your employer no later than 30 days before the transfer.

This requirement also applies to employers with less than 50 employees.

Complain to the Workplace Relations Commission (WRC)

You can bring a complaint to the WRC within 6 months if:

• You have been dismissed because of the transfer, or
• Your employer failed to consult you or your union

The time limit may be extended for up to a further 6 months if there was reasonable cause for the delay.

Use the online complaint form on workplacerelations.ie.

Complain about your pension

Complaints about pensions covered by the Pensions Acts should be referred to the Pensions Authority - see 'Where to complain' below. Complaints about other pensions should be referred as above.

Get more information on the transfer of undertakings from the Workplace Relations Commission's Information and Customer Service.

The Code of Practice on Employee Involvement in the Workplace and an explanatory booklet on the transfer of undertakings (pdf) are on workplacerelations.ie.