Small IT Dept to be outsourced: ToU-PE fears - are they justified?

O

Omega

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We are in an IT dept. of about 12 persons, about 4 of whom are unionized.

The company is currently offering a reasonably good voluntary redundancy package but we IT people have been told that we may be outsourced under the "ToU-PE" arrangement, in which case we would not be eligible to apply for the redundancy package. Is this legal?

If so, what's to stop the new company getting rid of us soon after and just giving a pittance in statutory redundancy?

Also, is our current DB pension scheme guaranteed? If you refuse to transfer, does the original company still have to employ you? Thanks for any comments.....
 
Re: ToU-PE fears - are they justified?

Under TUPE, your new employer must honour your rights wrt years of employment so they would have to pay your redundancy for the years you worked in the current company.

TUPE does not guarantee pension rights, so you are very likely to lose your DB pension.

I dont know about your rights wrt being forced to move employer I have onyl seen TUPE used when a company was bought or changed ownership, so the option of continuing to work for the previous employer did not exist.
 
Re: ToU-PE fears - are they justified?

TUPE does not guarantee pension rights, so you are very likely to lose your DB pension.
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ToU-Pe does protect your pension rights.

Effectively what is happening here is that your old employer is selling the IT department to a 3rd party. Under ToU-Pe regulations the new employer is obliged to honour the T&C's of the employees (including pension rights). The new company is obliged to retain the DB scheme for existing members. Is this a funded DB scheme (some Bank schemes are unfunded)? If it is a funded scheme, is it adequately funded?

The new company is free to negotiate terms with the representatives of the employees.

You cant force the old company to grant you the volunatary redundancy package.

what's to stop the new company getting rid of us soon after and just giving a pittance in statutory redundancy?
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The new company can make you redundant in the future and offer only statutory redundancy terms. I imagine that any company which would buy the IT department as a going concern would want to reatin staff and make a return on their investment.

Do you know who the company that is buying the IT department is? What is their track history? Are they associated in any way with the old company? How solvent are they? Does the old company intend having a service agreement with the new company and if so how long does the service agreement last.

You should join the union (even at this late stage) and get the tu officials to negotiate the terms of the sale of the business.

aj

have a look at the five or so key posts concerning ToU-Pe in the key posts sticky at the top of the forum.
 
Re: ToU-PE fears - are they justified?

Ajapale,


My understanding is that pension rights are not protected under TUPE.

Can you post some links, as a similar situation to this happened in my company (Outsourced IT Dept), and they were told to sell their Non-Contrib. by actuaries.
 
Re: ToU-PE fears - are they justified?

Hi Crumb,

It looks like Im wrong there is a pensions exception to the Tupe regulations.

My misunderstanding arose because in my company pension rights were preserved in the case of subsidiaries which were bought and sold.

aj

Also See [broken link removed]:

 
Despite the non-obligation on the employer's part to provide the same pension benefits in the outsoured company, it looks like in this case the the IBOA "negotiated" this for their members - am I correct in this?
 
Yes, I think the Mulvey Report was an attempt to resolve the dispute between IBOA and BoI. Part of that dispute resolution process was to provide a framework for discussion pension and other rights.

The Report [broken link removed] makes interesting as it documents other small IT departments some as small as 8 people in other companies which were transferred to HP.
 
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