TUPE in 2026. A practical guide for employers involved in business transfers, outsourcing, and retendering.

The Transfer of Undertakings (Protection of Employment) Regulations 2006  known as TUPE  remain one of the most misunderstood and most frequently misapplied areas of UK employment law. For employers involved in buying or selling businesses, outsourcing services, or bidding for and losing service contracts, understanding TUPE is not optional.

When does TUPE apply?

TUPE applies in two types of situation. The first is a business transfer  where a business or part of a business transfers from one employer to another as a going concern. The second is a service provision change,  where a service is outsourced to a contractor, brought back in-house, or transferred to a new contractor on a retender.

The service provision change limb of TUPE is broader than many employers appreciate. It applies whenever:

• A client outsources an activity to a contractor for the first time
• A client brings an outsourced service back in-house
• A client changes contractor on a re-tender, and the incoming contractor takes on essentially the same service

What happens when TUPE applies?

When TUPE applies, employees assigned to the transferring business or service automatically transfer to the new employer on their existing terms and conditions. The new employer steps into the shoes of the old employer.

Dismissals connected to the transfer are automatically unfair. There is no qualifying period for a TUPE-related unfair dismissal claim. A day-one employee has exactly the same protection as one with ten years’ service.

Attempting to harmonise terms and conditions after a transfer is generally unlawful, unless there is an economic, technical, or organisational reason involving changes in the workforce. The bar for meeting this test is high.

Obligations on the outgoing employer

The outgoing employer must:

• Inform and consult appropriate employee representatives before the transfer takes place
• Provide the incoming employer with employee liability information at least 28 days before the transfer

The employee liability information must include the identity and age of the transferring employees, their key terms and conditions of employment, details of any applicable collective agreements, any disciplinary action or grievance proceedings within the previous two years, and details of any legal claims brought by employees in the previous two years or which the transferor reasonably believes may be brought.

Obligations on the incoming employer

The incoming employer must honour the existing terms and conditions of transferring employees. It must also inform and consult employee representatives about any measures it intends to take in relation to transferring employees.

TUPE and the January 2027 qualifying period change

From January 2027, employees will have unfair dismissal rights after six months. This makes TUPE compliance even more important for incoming employers who take on transferred staff, as any dismissal connected to the transfer will be automatically unfair regardless of the employee’s length of service.

How Davenport Solicitors can help

At Davenport Solicitors, we advise both outgoing and incoming employers on TUPE obligations, information and consultation processes, and post-transfer compliance. If you are involved in a business transfer, outsourcing exercise, or re-tender, take advice before the process begins. Call us on 020 7903 6888 or email contact@davenportsolicitors.com