Change of Contract & TUPE

cpb353

Hi. I'm looking for some advice and hope people here may be able to help. This post goes on for a while - please bear with me.

I have worked for my current employer for around 10 years. Last year, we were sold to a new employer and transferred to the new company under TUPE.

Around 6 weeks ago, the new company announced a new set of 'Employee Benefits' company wide and a standardisation of the contract of employment. We were all invited to a meeting to listen to the new benefits package which was touted as 'a good deal for everyone'.

There have been a number of changes proposed, some good, some bad but leave me with a lesser benefits package than I currently enjoy.

Specifically:

1. Company Car. I currently get a company car with no terms or conditions attached which is available for Business and Private use and comes with a company fuel card. The new company are proposing that a company car is now available for people only doing more than 20,000 business miles a year or the Sales Team or those who carry 'tools'. I generally do less than 20,000 miles per year, so the next step down, for employees doing more than 6,000 business miles per year will be given a car allowance (of around £3000 pa in being told) and then claim back business mileage at 40p per mile. I fall in to this catergory.

Unless I can prove that I carry tools (although the company fail to define 'tools') I will have my company car taken away and given a pittance of a car allowance.

I personally feel that this is a big negative change to my contract which I am unhappy about.

2. Permament Health Insurance. I currently enjoy a (very good) PHI benefit. The benefit currenttly pays 75% of my salary until retirement after I have been off work for 13 weeks. The proposal is to change this to 75% of my salary to be paid for 2 years after I have been off work for 26 weeks. Again, another big change to my current terms and conditions.

The positive parts of the proposed benefit change include:

1. A company pension, where the employee contributes 3% and the employer 1%. I dont have a pension at the moment so would be a good benefit I think, although the company contribution is only £320 per year based on my current salary so is somewhat lower than the benefit I gain from my Company Car and Permanent Health Insurance.

2. Health Cash Back Plan to pay for dental and medical treatment up to (I think) £250 per year. I will be taxed for having this perk but all the same, it would mean I can afford to go to the dentist for the first time in years!.

After the presentation on the above, we then had individual meetings. I raised my concerns with and was told that it was my decision as to whether I signed or not, but if I did not I would not get the benefits of the new contract. As I pointed out, I would also not lose the benefits of my existing contract, as which point I was advised that if a certain percentage of the workforce sign the contract then it is deemed to be acceptable and that I can be served notice of dismissal if I fail to sign the contract and that a judge would also deem the contract as fair!!!

This of course scares the living cr*p out of me, but makes me feel I am being pushed in to a corner.

I could really do with any advice anyone can give me about this and how I should go about protecting myself both job-wise but also benefit-wsie.

Additionally, If anyone is able to give guidance on how TUPE protects against any of this would be very helpful.

Thanks in Advance.

SarEl

I am afraid that you are being pushed into a corner, and entirely lawfully. The company do not even need a percentage of the workforce to sign up to these changes - it will help them if most people sign up voluntarily but in the end they can enforce these changes under economic, techinical or organisational grounds and do exactly what they want. TUPE protections are wildly over-rated - contractual changes can be introduced almost immediately by employers provided they are for ETO reasons, and harmonisation of contracts often starts to occur a year or so after a TUPE quite lawfully. They are doing this by the text book - proposals, consultation etc. - and there is an almost certainty that a tribunal would indeed rule what they are doing is fair. If they choose to terminate the contracts of people who refuse, they must offer you a chance to sign the new contract before your notice ends, and the new contract must preserve your continuity of employment. If they do that they are not dismissing you - in law you are resigning. That puts you in a very weak position to claim, and given the process they have adopted then I cannot see any real prospects of your obtaining a ruling of constructive unfair dismissal. Sorry, but I think they have all their bases covered.

cpb353

SarEl wrote: »

I am afraid that you are being pushed into a corner, and entirely lawfully. The company do not even need a percentage of the workforce to sign up to these changes - it will help them if most people sign up voluntarily but in the end they can enforce these changes under economic, techinical or organisational grounds and do exactly what they want. TUPE protections are wildly over-rated - contractual changes can be introduced almost immediately by employers provided they are for ETO reasons, and harmonisation of contracts often starts to occur a year or so after a TUPE quite lawfully. They are doing this by the text book - proposals, consultation etc. - and there is an almost certainty that a tribunal would indeed rule what they are doing is fair. If they choose to terminate the contracts of people who refuse, they must offer you a chance to sign the new contract before your notice ends, and the new contract must preserve your continuity of employment. If they do that they are not dismissing you - in law you are resigning. That puts you in a very weak position to claim, and given the process they have adopted then I cannot see any real prospects of your obtaining a ruling of constructive unfair dismissal. Sorry, but I think they have all their bases covered.

Thank you very much for the prompt reply - really appreciate it even if it is not necessarily what I want to hear - at least you were able to give me some advice.

Is there anything I can do about them wanting to change the terms by which a company car and PHI are offered?

These really are the only sticking points in a otherwise pretty good package. . . .

Thanks

getmore4less

I would look at the car situation properly do a full cost analysis

many find the allowance + mileage works out better for average mileages.

Whats the current lease allowance.

whats the car/fuel tax

Also point out that 40p is no longer a realistic amount with current fuel costs


Might be worth consulting/negotiating a lump sum compensation for the transition to help buy a car. but you would need to present real number showing how much worse off you are.

SueC_2

cpb353 wrote: »

Thank you very much for the prompt reply - really appreciate it even if it is not necessarily what I want to hear - at least you were able to give me some advice.

Is there anything I can do about them wanting to change the terms by which a company car and PHI are offered?

These really are the only sticking points in a otherwise pretty good package. . . .

Thanks

There's nothing stopping you from trying to negotiate with them, but frankly I suspect that the 'package' is exactly that - a package - not something from which you can cherry pick the bits that are attractive to you and reject the rest.

Good luck!

cpb353

getmore4less wrote: »

I would look at the car situation properly do a full cost analysis

many find the allowance + mileage works out better for average mileages.

Whats the current lease allowance.

whats the car/fuel tax

Also point out that 40p is no longer a realistic amount with current fuel costs


Might be worth consulting/negotiating a lump sum compensation for the transition to help buy a car. but you would need to present real number showing how much worse off you are.

Using my Tax Code notification, it suggests that my 'car benefit' is £4615 and my 'fuel card benefit' is £3960.

They are proposing a car allowance of around £3000 pa, which would then be taxed.

I probably do around £10,000 business miles per year.

The point is that I don't want to own my own car and all the fun that goes with it. I like the reassurance that if it breaks down, it gets fixed. if I need tyres, they are replaced, and I dont have to worry that come the end of the month I dont have enough money to put fuel in the car.

The other issue of course is lets say I take the car allowance and get a car, and then in 6 months I am made redundant. Right now, I give the company car back and it is done, whereas with an allowance I would need to keep up the payments. I know I can get cover for this sort of thing, but I currently drive a VW Passat company car and would struggle to even get a Smart Car for less than £250 per month!

This is not meant to be a rant, but the financial hardship owning my own car would have is very big.

cpb353

SueC wrote: »

There's nothing stopping you from trying to negotiate with them, but frankly I suspect that the 'package' is exactly that - a package - not something from which you can cherry pick the bits that are attractive to you and reject the rest.

Good luck!

I agree that, and would be just as happy staying as I am and rejecting the whole new contract.

The benefits they are proposing to give add up to probably £2000 per year in real terms, but loss of PHI and Company car equates to at least 4 times that.

Their stance is pretty much 'sign or get lost' which after the years of service I have put in seems wrong

SueC_2

cpb353 wrote: »

I agree that, and would be just as happy staying as I am and rejecting the whole new contract.

The benefits they are proposing to give add up to probably £2000 per year in real terms, but loss of PHI and Company car equates to at least 4 times that.

Their stance is pretty much 'sign or get lost' which after the years of service I have put in seems wrong

Time to start looking for a new job perhaps.

getmore4less

cpb353 wrote: »

Using my Tax Code notification, it suggests that my 'car benefit' is £4615 and my 'fuel card benefit' is £3960.

They are proposing a car allowance of around £3000 pa, which would then be taxed.

I probably do around £10,000 business miles per year.

The point is that I don't want to own my own car and all the fun that goes with it. I like the reassurance that if it breaks down, it gets fixed. if I need tyres, they are replaced, and I dont have to worry that come the end of the month I dont have enough money to put fuel in the car.

The other issue of course is lets say I take the car allowance and get a car, and then in 6 months I am made redundant. Right now, I give the company car back and it is done, whereas with an allowance I would need to keep up the payments. I know I can get cover for this sort of thing, but I currently drive a VW Passat company car and would struggle to even get a Smart Car for less than £250 per month!

This is not meant to be a rant, but the financial hardship owning my own car would have is very big.

Not clear what tax band. whats the salary?

A company pension, where the employee contributes 3% and the employer 1%. I dont have a pension at the moment so would be a good benefit I think, although the company contribution is only £320 per year based on my current salary

That does not look right £320 based on 3% is £10.66k
whats the real numbers

Anyway lets assume you are 20% tax band.

You are currently taxed £1715.

£3k Allowance will be taxed at 20% and NI at 12% £2040 net.

So you will have £3755py to run a car.
Supplimented by business miles @ 40ppm. about 25p after fuel costs @ 10k thats another £2500 tax free

So well over £6k to run a car for a year

Should be relatively easy to do it for less unleass you are doing a lot of private miles.

The other option you have is to refuse the car allowance not run a car and say they will have to provide transport for business use.

SueC_2

cpb353 wrote: »

The other issue of course is lets say I take the car allowance and get a car, and then in 6 months I am made redundant. Right now, I give the company car back and it is done, whereas with an allowance I would need to keep up the payments.

Of course, the other way of looking at that is that if you are made redundant and have to hand the car back, you are left with no transport, which is probably going to make it harder for you to find a new job.

I've always taken the view that if I own my own car, no-one can take it, or the freedom it gives me, away from me.

saintjammyswine

I understand the problem. With a fully ex'd car there is no stress and no worries about maintenance etc. I have had colleagues that have taken the allowance route and they have made £300 p/m + on me with tax/fuel/allowance etc. (Our allowance was £450 p/m though, £3k p.a. sounds very low). The problems thye encoutered though were that one had an own fault accident that wrote the car off, insurance covered it but took ages to sort out & he had to get alternatve, one had an engine blow and he had to pay £2.5k for repairs, one got sacked and still had to pay the £400 p/m leasing costs. It sounds like you will not have an option in this, might be time to be looking around. Sorry.

Oh and I also would not take allowance because of the same reasons. Its ok not to drive personally due to lack of fuel money but clients tend to frown on it!!