Transfers of undertakings in the United Kingdom

Abstract

Discusses the transfer of undertakings in the UK, referring to the Transfer of Undertakings (Protection of Employment) Regulations of 1981, the Employment Rights Act 1996, and the Acquired Rights Directive 1977. Provides the raison d’etre of the Acquired Rights Directive and outlines how it was implemented in the UK. Talks about the confusing jurisprudence of the European and British courts, mentioning the European Court of Justice’s challenges to the directive, the 1994 proposals, amended 1997 proposals, the Commission’s memorandum of 1997 and the UK government’s consultation papers. Describes how the European Directive is applied and interpreted in relation to the Acquired Rights Directive and transfer of undertakings. Outlines the regulations controlling compulsory competitive tendering. Points out the obligation to inform and consult on the transfer of an undertaking and how the directive is enforced if this fails to occur. Notes the effect a relevant transfer has on existing collective agreements and the legal implications of dismissing employees by reason of the relevant transfer. Looks at the European Commission’s proposal for a directive on safeguarding employees’ rights in the event of transfer and the implications that would have on UK business. Concludes that a new directive is needed, building on the 1977 Directive but ironing out its inconsistencies.