TUPE and Redundancy: Pre-Transfer and Post-Transfer

TUPE doesn't prevent genuine redundancies, but protects against using redundancy as a disguise for transfer-related dismissals.

TUPE and Redundancy Can Coexist

Not Mutually Exclusive

Both can apply:

• TUPE protects employment during transfers
• But genuine redundancies can still occur
• Must be genuinely about jobs disappearing
• Not about the transfer itself

The Key Test

Is the redundancy:

Genuine Redundancy	Disguised TUPE Dismissal
Role actually redundant	Role continues but with new employer
Work requirements diminished	Just want fewer staff
Would happen anyway	Only because of transfer
ETO reason exists	Cost-cutting for sale

Pre-Transfer Redundancies

By Old Employer

Before transfer, old employer may claim:

• Roles are redundant
• Business reorganizing
• Needs to reduce headcount
• Independent of transfer

Suspicious Timing

Redundancies just before transfer:

• Tribunal will scrutinize heavily
• Burden on employer to prove genuine
• Connection to transfer inferred
• Must show would have happened anyway

When May Be Genuine

Could be genuine if:

• Redundancy process started before transfer plans
• Clear business case independent of sale
• Fair selection process
• Proper consultation
• Documented before transfer discussions

When Likely Not Genuine

Probably TUPE dismissal if:

• Announced after transfer agreed
• To make business more attractive
• Save new employer money
• No business case beyond transfer
• Roles continue with new employer

Post-Transfer Redundancies

By New Employer

After transfer, new employer may need to:

• Restructure combined business
• Merge overlapping roles
• Reduce duplication
• Genuine reorganization

ETO Requirement

Must show:

• Economic, technical or organisational reason
• Entailing changes in workforce
• Not just cost-cutting
• Actual role changes or reductions

Timing Matters

When	Tribunal View
Immediately after	Very suspicious, likely connected
Weeks after	Still suspicious
Months after	More credible
Years after	Likely unconnected

But even immediate redundancies can be genuine if properly justified.

Genuine Redundancy Situations

Business Transfer Scenarios

Merging Two Businesses

• Two sites become one
• Overlapping roles redundant
• Genuine reduction in headcount
• Fair selection needed

Integration and Efficiency

• Combined business needs fewer managers
• Overlapping functions merged
• Genuine organizational reason
• Must follow fair process

Business Closure

• Part of old business closing
• Roles genuinely disappearing
• Transfer of remaining business
• Redundancies can be genuine

Service Provision Change Scenarios

Contract Change

• Client reduces scope of services
• Fewer staff needed
• Genuine reduction in work
• Can be genuine redundancy

Technology Changes

• New equipment needs fewer operators
• Technical ETO reason
• Genuine workforce reduction
• Can be fair

Fair Redundancy Process

Even With TUPE

Standard redundancy process still applies:

1. Consult - collective if 20+ in 90 days
2. Fair selection - objective criteria
3. Consider alternatives - redeployment
4. Trial periods - for alternative roles
5. Appeal rights - must be offered
6. Redundancy pay - if 2+ years' service

Selection Criteria

Must be:

• Objective
• Non-discriminatory
• Applied fairly
• Scored consistently
• Documented

Cannot select:

• Because transferred from old employer
• Due to protected characteristic
• To remove "expensive" staff
• Arbitrarily

Consultation

If 20+ redundancies in 90 days:

• Collective consultation required
• Minimum 30 or 45 days
• Before final decisions
• With representatives
• Failure = protective award

Redundancy Pay Calculation

Continuous Service

Service includes:

• Time with old employer
• Plus time with new employer
• Continuous throughout transfer
• For redundancy calculations

Example: Started with Company A in 2015. Transfer to Company B in 2023. Made redundant by Company B in 2024. Continuous service is 2015-2024 (9 years).

Statutory Redundancy Pay

Based on:

• Age at redundancy
• Years of service (max 20 years)
• Weekly pay (capped at £700)

Age	Multiplier
Under 22	0.5 weeks per year
22-40	1 week per year
41+	1.5 weeks per year

Maximum: £21,000 statutory (2024/25).

Contractual Redundancy

If contract says:

• Enhanced redundancy scheme
• Better than statutory
• Must honor enhanced terms
• Transferred with employment

Alternative Employment

Duty to Consider

Before making redundant:

• Must consider if suitable alternatives exist
• Other vacancies in business
• Different roles
• Trial periods available

Suitable Alternative

Considered suitable if:

• Similar level of role
• Reasonable location
• Not substantially worse terms
• Match to skills and experience

Trial Period

Four-week minimum:

• Can be extended by agreement
• To assess if suitable
• Can leave during trial
• Redundancy pay preserved

Unreasonable Refusal

If refuse suitable alternative:

• May lose redundancy pay
• But role must genuinely be suitable
• Burden on employer to prove

Discriminatory Redundancy Selection

Protected Characteristics

Cannot select based on:

• Age
• Sex
• Disability
• Race
• Religion/belief
• Sexual orientation
• Pregnancy/maternity

Common Risks

TUPE redundancies risk discrimination if:

• Selecting older workers (age)
• Removing part-timers (indirect sex discrimination)
• Not adjusting for disability
• Targeting those with caring responsibilities (sex)

Must Justify

If criteria have discriminatory impact:

• Must show proportionate means
• To legitimate aim
• No less discriminatory alternative

Bumping

What Is It?

Selecting different employee:

• A is redundant
• But dismiss B instead
• Transfer A into B's role
• "Bumping" B out

Allowed Under TUPE?

Yes, if:

• Genuine business reason (ETO)
• Fair selection process
• Proper consultation
• Clear rationale

But careful - must not be:

• To remove transferred staff
• Discriminatory
• Connected to transfer improperly

Common Scenarios

Scenario 1: Redundancies Week Before Transfer

Old employer makes 10 redundant week before selling business to reduce headcount.

Analysis:

• Timing highly suspicious
• Likely connected to transfer
• Probably automatically unfair TUPE dismissals
• Unless clear evidence of independent reason

Scenario 2: Post-Transfer Merger

Six months after transfer, genuine merger of two departments, overlapping roles, fair selection, redundancies.

Analysis:

• Could be genuine redundancy
• Organizational ETO reason
• Changes to workforce (job reductions)
• Fair process crucial
• May be lawful

Scenario 3: Immediate Post-Transfer Redundancies

Day after transfer, new employer announces redundancies "due to financial position."

Analysis:

• Connected to transfer
• No genuine ETO (cost-cutting)
• Automatically unfair TUPE dismissals
• Should have been planned/consulted before

Challenging Redundancy

Grounds to Challenge

Argue:

• Not genuine redundancy
• Connected to transfer
• Selection unfair
• Process flawed
• Discrimination
• No ETO reason

Evidence Needed

Gather:

• Timeline of transfer and redundancy
• Business case (or lack of)
• Selection criteria and scores
• Consultation records
• Comparator treatment
• Role continuing or not

Claims Available

Depending on facts:

• Automatically unfair dismissal (TUPE)
• Ordinary unfair dismissal (if process unfair)
• Discrimination
• Failure to inform/consult
• Protective award

Summary

Genuine Redundancy Allowed

• TUPE doesn't prevent all redundancies
• Genuine job losses can occur
• Must have ETO reason
• Fair process essential

Tests for Genuine

• Are roles genuinely disappearing?
• Or just transferring with changes?
• Independent business case?
• Fair selection?
• Proper process?

Pre-Transfer Redundancies

• Heavily scrutinized
• Must prove would happen anyway
• Timing very suspicious
• Burden on employer

Post-Transfer Redundancies

• Can be genuine
• Need ETO reason
• Organizational changes legitimate
• But must be real, not pretext

Rights Protected

• Continuous service preserved
• Redundancy pay calculated including old service
• Fair process required
• Selection must be fair
• Alternative employment considered

Key Points

For employees:

• Know if it's genuine or TUPE dismissal
• Challenge if suspicious
• Continuous service protects redundancy calculation
• Get advice

For employers:

• Genuine redundancies OK
• Must have ETO reason if connected to transfer
• Fair process essential
• Document business case
• Timing will be scrutinized

TUPE doesn't prevent genuine redundancies, but protects against using redundancy as cover for transfer-related dismissals. The key is whether the redundancy is real - jobs disappearing - or manufactured to facilitate the transfer.