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A consultation on draft regulations to reform legislation protecting employees' rights when companies change ownership was launched today by the Department of Trade & Industry.

The proposed changes update the Transfer of Undertakings (Protection of Employment) Regulations 1981 ("TUPE"), improving protection for employees and helping business by reducing transactions costs.

The consultation, TUPE, DRAFT REVISED REGULATIONS, includes proposals to:

* improve business flexibility by extending coverage of TUPE to service contracting operations, such as cleaning services, so employers and employees know where they stand from the outset of an ownership transfer;

* increase the transparency of the transfer process by introducing a requirement on the old employer to notify the new employer of any employment liabilities;

* clarify the circumstances in which employers can lawfully make transfer-related dismissals and negotiate transfer-related changes to terms and conditions of employment for 'economic, technical or organisational' reasons; and,

* give a significant boost to our promotion of the 'rescue culture' by introducing new flexibility into the Regulations' application in relation to the transfer of insolvent businesses.

The consultation seeks views on the draft Regulations announced by the Secretary of State for Trade and Industry in February 2003 and is open to anyone who wishes to respond. It forms part of the Government's general revision of the TUPE Regulations and will run for 12 weeks.

Note for Editors

1. The consultation can be found at
www.dti.gov.uk/er/tupeconsultation.pdf

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