1. What TUPE actually means.
Transfer of Undertakings (Protection of Employment) Regulations, or TUPE, apply in marketing when clients transfer from one supplier or agency to another, and govern the movement of staff between incumbent and new suppliers.
Staff transfers are required to happen under TUPE when service activities cease by one supplier and are taken up by another, and prior to the change there was an organised group of employees to carry out that client's work.
So if a client moves a major contract from one supplier to another, the new supplier has a legal duty to make provisions for staff who worked on that client's account at the old supplier.
2. The impact on suppliers.
Employees transferring to the new supplier under TUPE are entitled to the same salary and benefits package. This can have implications for a supplier's pay scales, holiday allowances and other benefits, and in turn can create a lack of uniformity and standardisation across the company. Where like-for-like benefits cannot be offered, other arrangements can be made. But all in all, it is a major undertaking.
3. TUPE costs may be passed on to the client.
TUPE transfers can be complicated and protracted, so many suppliers look to protect themselves from their cost by inserting indemnity clauses in their contracts. Any client looking to switch suppliers should read the small print for any TUPE-related costs.
4. Be realistic about the time the transfer will take.
Consultations on TUPE are long and complicated periods. Both the client and supplier have a responsibility to ensure good communications between HR departments and employees.
The new agency or supplier must ensure potential transferees needing to relocate are informed about the location, cost of living, site tours and location features such as schools and colleges.
And finally, all such information must be documented.