The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) implement the EU Acquired Rights Directive into UK law and continue to apply post-Brexit. TUPE covers two types of transfer: a business transfer, where an economic entity that retains its identity moves from one employer to another; and a service provision change, where a client brings in-house, outsources, or retendered a contract and the activities remain essentially the same. In both cases, the employment contracts of affected employees transfer automatically to the new employer on the same terms.
The key protections under TUPE are continuity of employment (service does not restart), preservation of contractual terms (the new employer cannot simply harmonise pay or conditions), and protection against dismissal. Dismissals connected to the transfer are automatically unfair unless there is an economic, technical, or organisational reason entailing changes in the workforce. Both the outgoing and incoming employers must inform and, where measures are envisaged, consult employee representatives before the transfer. Failure to inform or consult can result in a tribunal award of up to 13 weeks' gross pay per affected employee.
Post-transfer, the new employer inherits all employment liabilities, including outstanding claims, accrued holiday, and continuity for unfair dismissal or redundancy purposes. Enhanced contractual terms derived from a collective agreement are protected for a minimum of one year post-transfer. Micro-businesses and service provision changes involving a single employee are both within TUPE's scope, so size offers no automatic exemption.