TUPE Transfers Guide: UK Employer's Complete 2026 Reference

The Transfer of Undertakings (Protection of Employment) Regulations 2006, universally known as TUPE, protect employees when the business they work for transfers to a new owner or when a service they provide is taken over by a new contractor. TUPE is one of the most complex areas of UK employment law, and getting it wrong exposes both the outgoing and incoming employer to significant liability.

This guide explains when TUPE applies, what obligations it creates, and how to manage a TUPE transfer without falling into the most common traps.

When TUPE applies

TUPE applies in two main scenarios:

1. Business transfers (Regulation 3(1)(a))

A "relevant transfer" occurs when an economic entity — an organised grouping of resources (people, assets, or both) — transfers to a new employer and retains its identity after the transfer. This covers:

• Buying a business as a going concern
• Merging two businesses
• Transferring part of a business to another entity
• Taking over a franchise

A pure share sale does not trigger TUPE because the employer (the company) does not change — only the shareholders change.

2. Service provision changes (Regulation 3(1)(b))

This is the scenario most UK employers encounter. A service provision change occurs when:

• Outsourcing: A client assigns activities to a contractor for the first time
• Re-tendering: A client assigns activities from one contractor to another
• Insourcing: A client brings activities back in-house from a contractor

For TUPE to apply to a service provision change, there must be an organised grouping of employees whose principal purpose is carrying out the activities that are transferring.

What transfers with the employees

When TUPE applies, the affected employees transfer automatically from the old employer (the transferor) to the new employer (the transferee). The transfer happens by operation of law — no consent is needed and no new contracts are issued.

The new employer inherits:

What does NOT transfer

There are limited exceptions. Occupational pension rights relating to old age, invalidity, or survivors' benefits do not transfer under TUPE (though the new employer must provide a minimum pension provision). Criminal liabilities of the old employer also do not transfer.

Employer obligations

Information duty (Regulation 11)

The old employer must provide the new employer with "employee liability information" for each transferring employee at least 28 days before the transfer, in compliance with UK GDPR data sharing requirements. This includes:

• Identity and age of each employee
• Employment particulars (as required under section 1 of the Employment Rights Act 1996)
• Details of any disciplinary or grievance proceedings in the previous 2 years
• Details of any legal actions brought by employees in the previous 2 years
• Details of any collective agreements

Failure to provide this information can result in a tribunal award of at least £500 per employee.

Consultation duty (Regulations 13-16)

Both the old and new employer must inform and consult appropriate representatives of affected employees. "Affected employees" includes not just those who will transfer, but also employees of either employer who may be affected by the transfer.

The information that must be provided includes:

1. The fact that a transfer is going to take place and the approximate date
2. The reasons for the transfer
3. The legal, economic, and social implications for affected employees
4. Any measures the employer envisages taking in connection with the transfer

If either employer envisages taking "measures" in connection with the transfer (such as changes to working arrangements, restructuring, or redundancies), they must consult with representatives with a view to reaching agreement.

Changes to terms and conditions after TUPE

One of TUPE's most protective provisions is the restriction on changing employment terms after a transfer. Any variation to an employee's contract is void if the sole or principal reason for the change is the transfer itself.

This means the new employer generally cannot:

• Reduce pay or benefits to align with their existing workforce
• Change working hours or patterns to match their standard terms
• Remove contractual benefits that the old employer provided
• Impose new restrictive covenants

There are limited exceptions:

Economic, technical, or organisational (ETO) reason entailing changes in the workforce. If the employer has a genuine ETO reason that requires changes to the workforce (usually meaning redundancies or changes in job function), variations may be permissible. But "harmonising terms" is not in itself an ETO reason.

Changes unconnected to the transfer. If there is a reason for the change that is entirely unconnected to the transfer — for example, a change that would have happened regardless — the variation may be valid.

Dismissals connected to TUPE

A dismissal is automatically unfair if the sole or principal reason for it is the TUPE transfer. This applies to dismissals by both the old and new employer, before or after the transfer.

However, a dismissal for an ETO reason entailing changes in the workforce may be fair if carried out through a fair procedure. Redundancy is the most common ETO reason. If the new employer genuinely needs fewer employees post-transfer, a fair redundancy process can justify the dismissals.

Due diligence for the incoming employer

If you are the new employer taking on TUPE-transferring employees, thorough due diligence is essential:

1. Request employee liability information well in advance of the 28-day deadline
2. Review all employment contracts for unusual or costly terms
3. Check for outstanding claims or grievances
4. Assess pension obligations and the cost of minimum pension provision
5. Identify any employees on long-term sick leave, maternity leave, or other protected leave
6. Review collective agreements and trade union recognition
7. Audit holiday accruals — you inherit the liability for untaken leave
8. Check for restrictive covenants that may affect your business plans
9. Assess payroll arrangements including any salary sacrifice schemes in place

Build a realistic cost model that includes all inherited liabilities. The price of the transfer or contract should reflect the true employment costs you are taking on.

Employee objections

An employee has the right to object to transferring to the new employer. If they object, they are treated as having resigned on the date of the transfer — they do not transfer and are not dismissed. This means they have no entitlement to redundancy pay or notice pay (unless the transfer involves a substantial detrimental change to their working conditions, in which case they may be able to claim constructive unfair dismissal).

In practice, most employees transfer without objection because the alternative is losing their job with no compensation. However, if the transfer involves a significant downgrade in terms or conditions, some employees may choose to object.

Frequently asked questions

Next steps

Key takeaways

TUPE exists to protect employees during business and service provision changes. The key compliance points are: determine whether TUPE applies, provide employee liability information on time, consult properly with employee representatives, do not change terms because of the transfer, and conduct thorough due diligence before taking on transferring employees.

The cost of non-compliance is high — 13 weeks' pay per employee for failure to consult, plus automatic unfair dismissal for transfer-related terminations. Invest the time in getting the process right. For related guidance on managing workforce changes, see our redundancy process guide and employment contract essentials.