Employee Protection when a Business Owner Changes

23 March 2006:

From 6 April 2006 employees will have more protection when a business - or part of a business - is transferred from one owner to another. A business transfer occurs when the identity of the employer changes. For the first time, the rules will also apply to long-term business relationships for contracted services. These include office cleaning, workplace catering, security guard services and refuse collection that are:

- awarded to a contractor
- taken back in-house from a contractor
- transferred from one contractor to another

Before any transfer, all employers will have to:

- give the new employer specific information about employees under transfer
- inform and consult with representatives of the affected employees

In general, employees are automatically transferred to the new employer who takes over the business together with:

- the contracts of employment of all the employees to be transferred
- all rights and obligations arising from the existing contracts of employment
- any existing collective agreements or trade union recognition

Under some specific conditions - e.g. insolvency - it may be possible for you or the new employer to change employee terms. But the employees will have to agree to the new terms.

You will not be able to dismiss employees because of the transfer itself or for a reason related to the transfer. If you do so without a sound economic, technical or organisational reason - the dismissal will be automatically unfair.

For more information contact Business Link Wessex by phone for information about getting free legal advice through The Law Society or email them if you have any employment questions you would like answered:

Tel: 08454 58 85 58

Email: [advice@businesslinkwessex.co.uk]

Website: [www.businesslinkwessex.co.uk]