TUPE Employee Liability Information
Employee Payments Don’t have to be Identified as Contractual/Non-Contractual
Employee Liability Information is important information that any employer should ensure they receive before accepting a TUPE transfer. (It’s shocking how often SME employers announce after the event that they didn’t concern themselves to receive this, or that they didn’t check it carefully to know what liabilities are being transferred as part of a TUPE contractual change.)
But even if a potentially-new-employer receives the information, the transferee needs to ensure they fully understand what they have received. The full details of what needs to be disclosed can be found at Regulation 11, TUPE Regulations 2006, but one that caused some expense in Born London Limited v Spire Producton Services Limited was the normally innocuous & routine statement of particulars that are issued to each employee in accordance with s1, Employment Rights Act 1996.
In Born v Spire, the ELI was duly provided, but in doing so Spire had described terms as contractual and non-contractual; a Christmas bonus was listed under the latter – as non-contractual.
As events transpired at a separate employment tribunal hearing, the Christmas bonus was found to be a contractual term, but the Employment Appeal Tribunal found this not to matter. As long as the details complaint with s1, Employment Rights Act 1996 were provided (with or without any labels describing them as contractual or non-contractual), the Employee Liability Information was deemed to have been served.
This judgment also implies that, with consideration to section 27, Employment Rights Act 1996, the Statement of Particulars should not exclude non-contractual terms.
As always, potential transferees need to be careful to ensure they obtain the ELI, and that those advising them understand it too – not always best left to one law firm that specialises in one relevant area of law.