smallbusiness.co.uk: Helping your business think big

Email a Friend

If a company is sold, do new owners have to employ the existing staff on the same terms as their original contract? 

When a company is sold, the employees of the old company are transferred to the the new company and are protected under TUPE – the Transfer of Undertakings (Protection of Employment) Regulations 2006.
 
As a result of the transfer of undertaking an employee’s terms and conditions of employment are protected, unless there is a genuine economical, technical or organisational reason that applies. An employee under TUPE will transfer to the new company on the same terms and conditions of employment eg same salary, same benefits. They will also retain their period of continuous employment, that is their start date of employment will be the date they began their original employment with the old company (unless they were also transferred to that company which means their start date would be earlier).
 
There are many technical issues surrounding TUPE and any changes being considered to terms and conditions should be discussed with professionals with knowledge on this subject.  There may be a lawful reason to vary a contract if it is an ETO, but you do not want to put yourself at risk of claims to an employment tribunal.
 

See also: Tax break set to stay

Previous article

How to approach redundancies

Next article

Interim Management: What You Need to Know

Post a comment

3 comments

Julie Thorpe

If the new owners do not keep the existing staff on, do they have to make them redundant?

Phyl Ee

I am buying a company and there are 2 existing staff members that I have to employ under TUPE. The one staff member is terrible at her job and has chased customers away. How can i get over this as i do not want her on my team.

Bismack Gham Lovsah

MY company is sold ,and we are still working with a new owner,but we do not kwon have agreement will be .but our new owner always talk of visa and contrat change.please,i wish to kown wheather that can be done without salary and other benefits change that is increst salary .thanks

Related

News | Outlook

Finding a business for sale

News | Management

How to win customers online and make them stay

News | Management

Getting the right staff

News | Management

How to make your first sale

Small Business Offers

  • Apprenticeships - The University of Work

    Apprentices study your business in your business. By learning your way of working they can help your company to grow. Kick-start the process today. 

  • Compare business insurance quotes

    Tailor your policy, compare quotes and buy in minutes! Up to 50% No Claims Discount. Compare quotes or call 0845-0723340 today.

  • Making a connection

    A free small business guide to communication technology, brought to you by Vonage and SmallBusiness.co.uk.

  • Want to process payments on your website?

    Accept credit cards online via our secure, stable and easy gateway. Sign up now for summer savings – no setup fee, no monthly fees until September.

  • The smarter way to get cash flowing

    Running a business can be challenging so it’s important to ensure that you choose a funding solution that keeps you firmly in control while providing the flexibility to grow.

  • Content Choices from SmallBusiness

    Receive regular guides, whitepapers and advice to help you start and run a successful business.

More from Small Business

Starting a Business
How important is education for business owners and entrepreneurs?

How important is education for business owners and entrepreneurs?

Sometimes entrepreneurs consider education in the hope it can prepare them for running a business....  

Financing a Business
How good is the record keeping in your business?

How good is the record keeping in your business?

Jesper Frederiksen looks at the basics of record keeping for small businesses and what can...  

News
Majority of small companies do not last beyond five years 

Majority of small companies do not last beyond five years 

Business survival rates have fallen significantly since the financial crisis, research finds. ...  

Blog
Why starting a business from your bedroom beats Silicon Roundabout

Why starting a business from your bedroom beats Silicon Roundabout

Here, Irfon Watkins argues against the trend to centralise start-up activity in certain locations. ...