A question on TUPE and 'non contractual benefits'

Gentoo365

I have been told that non-contractual benefits do not transfer under TUPE. Neither do policies such as a 'long service award' or redundancy policies that are not 'custom and practice' I have also been told that any employee transferring does not automatically become eligible for benefits and redundancy policies of the new company.

Is this correct?

As this means that in some circumstances a TUPE employee could lose existing benefits, and not have them replaced. It also seems that whilst people made redundant prior to the transfer received enhanced redundancy (via compromise agreement), those that were transferred are only eligible for statutory.

It also means that for some people (who are not being made redundant) they will not get a 'long service award' as they are not automatically eligible for that offered by the new employer and that offered by the previous employer was not contractual.

London18

Correct, non contractual benefits don't transfer.
After transfer, entitlement to any benefits offered by the new employer is subject to whatever criteria they apply. For example length of service for extra holiday or grade status for medical insurance cover.

Yes, a transferring employee could lose some benefits on transfer if they were discretionery. For example your current employer might have a non contractual season ticket loan option, the new one might not. Or indeed Long service awards.

Enhanced redundancy is nearly always discretionery, the employer doesn't have it give it to you (this depends on employment contract wording or union agreements though). Compromise agreements commonly involve some extra money to incentivise the person to sign, as they are giving up statutory rights such as right to take a Tribunal claim.

Note that there are lots of myths about the effect of'custom & practice' and they are harder to prove than you might think (and even then the ultimate authority on them is an Employment tribunal). C&P means 'implied terms' i.e. something automatically part of a contract even if they’re not written down Examples are employees being expected to be honest and trustworthy,a legal requirement (like the right to statutory minimum holidays) or something that’s been done regularly in a company over a long time (like only having to work a half day on Christmas Eve amd closing the office/shop/factory early, or a Xmas bonus).



It is the 'long time in place' examples that cause most grief - don't assume just because something has 'always' been done it is an implied term that must transfer - these can be very debateable.


Policies (e.g. Disciplinary, grievance, redundancy) are rarely contractual (though again, sometimes they can be). There are legal requirements in some of these areas of course.


Sorry if this is not what you were hoping for.

Gentoo365

Thanks for the reply.

My issue is more about both employers having the schemes (e.g. season ticket loan), yet TUPEs not having eligibility from previous employment, nor inheriting it from the new employer.

I suppose any term that says 'managers discretion' or whatever can be used to say 'not for ex-employees of Y'

London18

Generally yes that's right you don't have an absolute right to non contractual benefits and the new employer can choose to restrict access if they choose to. In many TUPE service provision changes, this is often because they may have won the tender on a price that excluded the cost of providing those benefits to staff.

However it is often worth at least trying to negotiate on this (or ask your union to on your behalf). For example if they are going to provide the benefit but these have qualifying periods based on length of service and they are not using continuous start date with previous employer but date of transfer. It is always worth trying to negotiate!