Tupe employee rights in pre pack administration sale takeover?

TheSpiddalKid

In a pre-pack administration such as this would it meet the criteria of 'insolvency proceeding' within the regulations under which variations to terms are permitted?

Sandtree

maz_hartley said:

Sandtree said:

maz_hartley said:

In a pre pack administration sale where a company is bought out of administration and the employment is continuous what are the TUPE terms. I know that the employees existing terms have to be honoured. But in the case of the company taking over who say offers their staff better terms like more holidays and higher rate of pay do they have to honour these better terms to the staff their taking on or can they keep them on the existing terms if the previous employer?

If the administration ends with the sale of the company itself then there are is no TUPE because you were employed by ABC Limited and are still employed by ABC Limited. The fact that ABC Limited has new shareholders is irrelevant.

If ABC Limited isn't bought however but instead all the assets etc are bought by XYZ Limited inc the employees then TUPE potentially applies because your employer has then changed.

Although we were in a franchise with the company that has taken over and used their name but not actually owned by them until now if that makes any difference to the TUPE situation, thanks

A franchise is just a B2B relationship between two entities... it may include certain clauses about rights of first refusal to the franchisor etc but none of that impacts TUPE. If your legal employer has changed then in most cases you will have TUPE rights.

In part this is often why companies with complex legal entity setups fairly often have a service company that employs all staff in the company and they can then work on behalf any of the trading entities via intragroup agreements without having to mess about with transferring employees, consultations, TUPE etc