TUPE amendments and EWCs

A new consultation proposes two changes to TUPE and abolishing the legal framework for European Works Councils (EWCs).

As part of its Smarter Regulation initiative which it believes will ‘take advantage of our new regulatory freedoms having left the EU and have the potential to deliver simpler, clearer regulations’, the government has published a further consultation on amending UK employment law which will run until 11 July. Last year saw the first tranche of employment law reforms as part of this initiative.

TUPE

Following the earlier changes to TUPE, the government is now consulting on proposals to reaffirm that TUPE only applies to employees, and to prevent complex contract ‘splitting’ in cases where a business is split between multiple transferees. These reforms, says the consultation, will:

• reduce the complexity of the TUPE transfer process for employers and employees
• reduce the administrative burden and costs of TUPE for businesses
• provide additional clarity for both employers and employees

The government is therefore proposing to amend the TUPE definition of ‘employee’ to clarify that ‘workers’ are not protected by the regulations. Such an amendment will address the ambiguity created by the 2019 tribunal judgment in Dewhurst v Revisecatch Ltd t/a Ecourier around the question of whether limb (b) workers are covered by TUPE.

Also, to deal with the issue highlighted by the ECJ decision in ISS Facility Services NV v Govaerts & Atalian NV – that a full-time employment contract can be split between multiple employers when a TUPE transfer involves multiple transferees – the consultation is proposing to amend TUPE to clarify that an employment contract should only be transferred to one employer and should not be split between multiple employers. Instead, the employers taking over the business or service would be required to agree who should be responsible for each employee’s contract.

European Works Councils (EWCs)

The consultation proposes removing the legacy of the UK’s membership of the EU by repealing the legal framework for EWCs in the UK, which will include a repeal of the current requirement to maintain existing EWCs. The government believes that existing structures can effectively represent workers at company level in the absence of a EWC, such as unions or other employee representatives.

As part of a separate policy paper, Smarter Regulation: One Year On, the government is also proposing to raise the medium-sized company employee threshold from 250 to 500 employees. It would involve reclassifying 2,000 large companies as medium-sized so that they ‘benefit from reduced reporting requirements, which the government believes is a more appropriate level of reporting for firms which in many cases are family owned’.