Transfer of employment to another company....

[Carrot]

Good evening everybody, thank you in advance for viewing my post. Please find my story below, I would greatly appreciate some advice.

I have been employment with the same company for four years. I am a UK employee, born here, always worked here etc. The company is a US-based manufacturer of very high technology products. I am one of a small handful of specialist Sales Engineers in their employ in the UK. Last week, I was informed by management that our company would cease selling our products directly to our customers and that we would be moving over to a 'distributor' or 're-seller' model whereby a third party company would be responsible for selling our products within the UK. I was then informed that a distribution company had already been appointed within the UK and that my employment would transfer over to this distribution company on 1st October 2015. The distribution company in question has no association with my employer other than the fact that they have a) agreed to purchase some capital equipment from my employer (which would be essential for them to be able to sell our high technology products) and b) they have signed an exclusive distribution rights contract with my employer, allowing them to sell our products in the UK. Hence, this newly appointed distributor is an entirely independent entity from my employer.

I was casually told by my manager not to worry about this 'transfer of employment.' It has already been agreed between my employer and the appointed distribution company that all my working conditions, pay etc would remain as per my current contract with my employer. My employment will 'transfer' over to this distribution company on 1st October, presumably requiring the signing of a new contract. I have cause for concern over this, as the new distribution company in question is not a company I would wish to work for!

I am very keen to learn where I stand legally in this situation. In general terms, I understand that if a company is acquired or merged in the UK, an employee has the right to retain their existing working status, pay etc. But as my current employer has no association with the company I am being told I will have to work for, I am wondering what my options are.

Thanks for reading this and I hope there are will be some nuggets of wisdom forthcoming.

Thanks,
Carrot.

[FlamingParrot]

Re: Transfer of employment to another company....

Hi and welcome aboard

Your employment will be transferred under TUPE (Transfer of Undertaking Protection of Employment). Under TUPE, the terms and conditions of employment remain the same although there can be some changes regarding things like bonuses, share schemes, pension schemes, private health insurance and even sick pay (when more generous than the legal requirement). Your length of service with your employer will be the same, i.e. if you've been there four years you'll still have four years service with your new employer.

A company doesn't have to have any association with the company you currently work for. If you do not wish to work for the new company you are not obliged to do so, however, that would be the same as resigning and you wouldn't have the right to redundancy or to claim unfair dismissal.

Are there any particular areas of concern for you?

[Carrot]

Re: Transfer of employment to another company....

Thank you FlamingParrot for the very clear and concise reply.

I did wonder if TUPE would be applicable in this instance. It does seem a bit alien to me that a current employer can just hand you over to any random company providing that they basically guarantee your salary and holiday entitlement! In my personal situation, I have had previous dealings with the new distributor company I am being transferred over to. The way they conduct their business does not sit well with me and it is therefore not a company I would choose to work for. On the flip-side of the coin, I am an incredibly valuable asset to my company and the whole success of this new venture will be largely dependent on whether I choose to move to this distributor or not!

[FlamingParrot]

Re: Transfer of employment to another company....

Thank you FlamingParrot for the very clear and concise reply.

I did wonder if TUPE would be applicable in this instance.

Was TUPE not mentioned in your workplace in connection with the transfer?

It does seem a bit alien to me that a current employer can just hand you over to any random company providing that they basically guarantee your salary and holiday entitlement!

If the business is being transferred to another company or a certain part of the business outsourced (which seems the case here), the alternative would be to make everyone redundant and wish you good luck re-applying to the new employer.

In my personal situation, I have had previous dealings with the new distributor company I am being transferred over to. The way they conduct their business does not sit well with me and it is therefore not a company I would choose to work for.

Some years ago I was working for a company that decided to do something similar, i.e. outsource our department to one of them outsourcing outfits that lots of similar companies use. The outsourcing outfit has always had a bit of a reputation and a number of my colleagues had left other sites also run by that company, precisely with the intention of escaping them, so I know exactly what you mean.

On the flip-side of the coin, I am an incredibly valuable asset to my company and the whole success of this new venture will be largely dependent on whether I choose to move to this distributor or not!

That's quite a decision to make. If you've got something else in the pipeline, then it may be an idea to leave them high and dry.

[Carrot]

Re: Transfer of employment to another company....

Was TUPE not mentioned in your workplace in connection with the transfer?


If the business is being transferred to another company or a certain part of the business outsourced (which seems the case here), the alternative would be to make everyone redundant and wish you good luck re-applying to the new employer.


Some years ago I was working for a company that decided to do something similar, i.e. outsource our department to one of them outsourcing outfits that lots of similar companies use. The outsourcing outfit has always had a bit of a reputation and a number of my colleagues had left other sites also run by that company, precisely with the intention of escaping them, so I know exactly what you mean.

That's quite a decision to make. If you've got something else in the pipeline, then it may be an idea to leave them high and dry.

Correct, TUPE has not been mentioned at all by my employer. I guess they wouldn't make anybody redundant if they could help it, as this would presumably be quite an expensive exercise for them. Your colleagues' situation described above sounds identical to mine, not a great feeling! I think the way forward is to look for employment elsewhere as you suggest.

As I mentioned earlier, the most valuable asset to the new outsourced company in this agreement are the employees concerned (ie: three colleagues and myself.) Without us, the outsourced company do not have the skills and experience to pursue this new venture. Perhaps this could be time to negotiate with my employer regarding the transfer and my intended commitment to the new outsourced company?

[FlamingParrot]

Re: Transfer of employment to another company....

Correct, TUPE has not been mentioned at all by my employer. I guess they wouldn't make anybody redundant if they could help it, as this would presumably be quite an expensive exercise for them. Your colleagues' situation described above sounds identical to mine, not a great feeling! I think the way forward is to look for employment elsewhere as you suggest.

Just because it's not explicitly mentioned, it doesn't mean it doesn't apply. It can apply even in cases where people are made redundant and then offered a 'freelance' contract with another company.

As I mentioned earlier, the most valuable asset to the new outsourced company in this agreement are the employees concerned (ie: three colleagues and myself.) Without us, the outsourced company do not have the skills and experience to pursue this new venture. Perhaps this could be time to negotiate with my employer regarding the transfer and my intended commitment to the new outsourced company?

What sort of negotiation have you got in mind?

[Carrot]

Re: Transfer of employment to another company....

Just because it's not explicitly mentioned, it doesn't mean it doesn't apply. It can apply even in cases where people are made redundant and then offered a 'freelance' contract with another company.


What sort of negotiation have you got in mind?

Thank you once again for this invaluable information.

Perhaps some kind of financial incentive for me to move over to the outsourced company in return for my commitment to work for the new company for a fixed period of time? Is this ethical? Legal even? Or would they have to make me redundant first?

[wales01man]

Re: Transfer of employment to another company....

Without being rude you may be an asset but kick up a stink and you may be an EX asset no one is that important unless you can get all those involved to stand together a bad you may find yourself
out of work .
Talk to your employer if they are passing everything over to a new company they may or may not care what you say but try to find out what you need to know.