Case Study: TUPE / Redundancy
Area of work: HR Consultancy
Sector: Hospitality
Date/Length of relationship: 2009 – present
Background
An international restaurant chain decided not to renew the lease on some of its units. It proposed selling them to another restaurant operator and placing all employees based at those units at risk of redundancy.
Problem
The property legal team was concerned about potential TUPE implications and the possible financial consequences of proceeding without specialist employment law advice.
The client was looking for a sounding board and a second opinion. They sought our expertise to sense-check certain ideas and proposed courses of action.
Solution
Our role was to consider the evidence in the context of their wider commercial objectives, before advising on the employment law implications of the situation.
We arranged telephone conversations with the client and their legal representative on the property side to determine whether non-renewal of the leases and subsequent activity at the premises meant they would amount to ‘relevant transfers’ under TUPE.
We then carried out research into the relevant legislation and case law. Once we’d formed a provisional opinion, we discussed this with the client and their legal representative, before confirming in writing, with accompanying rationale.
Our support included all advice, guidance and correspondence pertaining to the eventual redundancy process, e.g. notification of collective announcement, announcement script, notification of individual consultation meetings, outcome letters and all documentation surrounding any appeal processes.
As the matter progressed, we kept the situation under review and provided further advice and support along the way.
Outcome
Although it was impossible to give the client an unequivocal guarantee that TUPE wouldn’t apply to the sale of the leases, we were satisfied that there was a fairly robust argument in favour of the position that the legislation wouldn’t operate to automatically transfer all the employees working in the units concerned, together with their contracts of employment, to the incoming restaurant operator. We reached our conclusion following the application of the ‘going concern’ test used by the Courts.
Our reassurance that there was a reasonable argument against TUPE applying to most of the units gave the client greater confidence to proceed in accordance with their wider commercial objectives.
The client appreciated our depth of knowledge and experience in such a complex area of employment law and continues to value our personal and commercially focused approach.
If you would like more information on the HR Consultancy services described in this case study, please contact Chris Nagel on 01942 369675.
