The Collective Redundancies and
Transfer of Undertakings (Protection of Employment) (Amendment) Regulations
2014, or “CRATUPEAR” for short, came into force on 31st January 2014. The current
government asserted that the TUPE
Regulations 2006 (“TUPE Regulations”)
provided transferred employees with more protection than was expressly required
under the Acquired Rights Directive
(“ARD”). The aim of CRATUPEAR was therefore to amend the TUPE Regulations to remove this so
called ‘gold-plating’.
Upon close analysis of the changes implemented by CRATUPEAR it is our view that the pendulum has shifted in the employer’s direction to such an extent that certain provisions of the new TUPE Regulations are no longer compatible with the ARD. One such example is the new provision that permits a transferee to vary the terms of a transferred employee’s contract if there is a term in the contract that permits variations (even if the reason for the variation is solely or principally related to the transfer itself). We would argue that this is in contravention of the ruling of the CJEU in Daddys Dance Hall [1988 IRLR 315} that held that a transferee could “alter the terms of the contract in all ways permitted by national law.................. provided that the transfer of business itself did not constitute the reason for the alteration.”
Domestic courts are required to implement domestic legislation in a way that is compatible with EU Law. If a domestic court determines that domestic legislation is incompatible with an EU Directive or a ruling of the CJEU, it is obliged to construe the legislation in a way that is compatible with EU Law; if necessary by inserting words into the legislation (Litster and others v Forth Dry Dock & Engineering Co Ltd and another [1989] IRLR 161). If a domestic court is unable to construe the legislation in a way that is compatible with EU Law then it is required to remove any contrary provisions from the legislation which renders it inconsistent (Kucukdeveci v Swedex & Co KG [2010] IRLR 346).
If our courts share our opinion that some of the provisions enacted by CRATUPEAR are not compatible with the ARD it will be up to them to construe such provisions, or alternatively remove words from them, to render the provisions compatible with the ARD. The result is an increase in uncertainty in the legislation surrounding TUPE. It would seem that (not for the first time) the government has proceeded with unnecessary (and frankly ideological) changes to our legislation. The only certainty is that there will undoubtedly be an increase in litigation in the area as a result of these botched changes. Employee protection is further reduced; but employers, too, will justifiably complain that they are less sure where they stand legally. The acronym itself, CRATUPEAR, is telling of the inadequate amount of thought put into this piece of legislation.
Upon close analysis of the changes implemented by CRATUPEAR it is our view that the pendulum has shifted in the employer’s direction to such an extent that certain provisions of the new TUPE Regulations are no longer compatible with the ARD. One such example is the new provision that permits a transferee to vary the terms of a transferred employee’s contract if there is a term in the contract that permits variations (even if the reason for the variation is solely or principally related to the transfer itself). We would argue that this is in contravention of the ruling of the CJEU in Daddys Dance Hall [1988 IRLR 315} that held that a transferee could “alter the terms of the contract in all ways permitted by national law.................. provided that the transfer of business itself did not constitute the reason for the alteration.”
Domestic courts are required to implement domestic legislation in a way that is compatible with EU Law. If a domestic court determines that domestic legislation is incompatible with an EU Directive or a ruling of the CJEU, it is obliged to construe the legislation in a way that is compatible with EU Law; if necessary by inserting words into the legislation (Litster and others v Forth Dry Dock & Engineering Co Ltd and another [1989] IRLR 161). If a domestic court is unable to construe the legislation in a way that is compatible with EU Law then it is required to remove any contrary provisions from the legislation which renders it inconsistent (Kucukdeveci v Swedex & Co KG [2010] IRLR 346).
If our courts share our opinion that some of the provisions enacted by CRATUPEAR are not compatible with the ARD it will be up to them to construe such provisions, or alternatively remove words from them, to render the provisions compatible with the ARD. The result is an increase in uncertainty in the legislation surrounding TUPE. It would seem that (not for the first time) the government has proceeded with unnecessary (and frankly ideological) changes to our legislation. The only certainty is that there will undoubtedly be an increase in litigation in the area as a result of these botched changes. Employee protection is further reduced; but employers, too, will justifiably complain that they are less sure where they stand legally. The acronym itself, CRATUPEAR, is telling of the inadequate amount of thought put into this piece of legislation.
Tony Rippon - Legal Assistant
For further information on Employment Rights, please visit our website or call 0033 3344 9603 and ask to speak with our Employment Rights team.
For further information on Employment Rights, please visit our website or call 0033 3344 9603 and ask to speak with our Employment Rights team.
