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Introduction to this document

Response to TUPE transfer objection

Employees have the right to object to their employment transferring to a new employer under TUPE by informing either the transferor or the transferee.

Right to object

The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) enable an employee to object to becoming employed by the transferee, and they can make their objection known by informing either the transferor or the transferee. They don’t need to object in any particular way, provided there’s an actual clear refusal by them to transfer which they communicate to either the transferor or the transferee. So, their objection could be verbal or in writing, but simply expressing concern about a proposed TUPE transfer won’t be enough. It’s best to encourage employees to put or confirm their objection in writing to avoid any subsequent dispute. There’s also nothing in the legislation that requires the employee to have been informed by the transferor or the transferee in advance of the legal consequences of objecting. However, you might consider it best practice to inform employees (either directly or via their representatives) of their right to object and the implications of doing so. If an employee wants to object, they should do so before the date of the TUPE transfer, but an objection made after the transfer date may still be valid in exceptional circumstances, e.g. if the employee hadn’t been told the TUPE transfer date or the identity of their new employer until after the transfer had happened.

Legal consequences

Where an employee does object, for example, because they simply don’t want to work for the transferee, their employment contract (and the rights, powers, duties and liabilities under or in connection with it) will not transfer to the transferee. Instead, their employment with the transferor is treated as having been terminated by operation of law with effect from the transfer date, as if they had resigned, and they don’t need to work out their notice period. There is deemed to be no dismissal and the employee isn’t entitled to any statutory or contractual compensation payment on the termination of their employment, meaning no redundancy payment and no payment in lieu of notice. The exceptions to this are where the employee has objected and resigned in response to either: (1) a repudiatory breach of contract by their employer (in which case there’s a constructive dismissal); or (2) a substantial change in their working conditions to their material detriment (in which case they’re treated as having been dismissed). Do also be aware that, if an employee does object to a TUPE transfer, the transferee won’t then be able to enforce any post-termination restrictive covenants in their employment contract as it will never have transferred over.

Letter contents

Our Response to TUPE Transfer Objection enables you to reply to an employee who has objected to a TUPE transfer. It acknowledges receipt of their objection and then goes on to set out the key legal consequences of their objection, i.e. their employment will terminate on the TUPE transfer date and they won’t receive any termination payment. It may also affect their right to claim State benefits as they haven’t been dismissed.