TUPE LAW - Taking over from my employer

Discussion in 'Askaboutbusiness' started by NickyLead, 2 Feb 2019.

  1. NickyLead

    NickyLead New Member

    I (and all colleagues) have been given dismissal notice as my boss is retiring. I am interested in taking a lease on the property (from him) and carrying on the business. He says I would need to buy the business for it to be legal (and take on the employees and lose my redundancy!).

    He's putting it up for lease anyway and would love for me to start the same business but both my solicitor and his solicitor say it's a breach of TUPE law - Transfer of Undertakings (Protection of Employment) Regulations .

    Is there any way around this so I don't lose my redundancy and don't have to take on the full team? Our dismissal was not because I wanted to buy the business but a result of my dismissal and I need my redundancy package.

    He says I can lease it and start any other type of business except the one we're in! Help! I want to transition the business seamlessly and have been waiting for this shot for 20 years! I can't start from scratch in another location or town due to the nature and current reputation of the business.
  2. RedOnion

    RedOnion Frequent Poster

    So, when professional advice doesn't give the answer you want, you turn to the anonymous internet?

    You're taking over the lease, continuing the same business, and getting the goodwill. There's no way around TUPE - it's clearly a continuation of the same business.

    The only exceptions could be if the business is insolvent.
    DeeKie likes this.
  3. NickyLead

    NickyLead New Member

    Indeed, both solicitors are general practitioners so I though if someone was through it or familiar with specifically company/employeement law there might be more insight! Thanks anyway... it looks like a non runner.
  4. Feemar5

    Feemar5 Frequent Poster

    I don't know anything about TUPE but I would be careful about taking on employees - are they getting redundancy or are you taking over their service to the existing company. If that is so and if in the future you had to make any of them redundant you would have to pay them for their service with you and their service with the current company.
  5. RedOnion

    RedOnion Frequent Poster

    That's pretty much what TUPE is. The service and terms and preserved.
  6. cremeegg

    cremeegg Frequent Poster

    A few thoughts.

    If the loss of your redundancy money makes the difference between your business being a success or a failure, its probably not a runner anyway.

    If your old boss does not have to pay you redundancy then you should be able to negotiate the lease to reflect this. Perhaps an extended rent free period.

    If you are afraid of letting unneeded staff go, then you are not cut out to run your own business.
  7. RETIRED2017

    RETIRED2017 Frequent Poster

    Out of interest is the reason you need the current property because it includes machinery not so easy to move,
  8. NickyLead

    NickyLead New Member

    It's not just my redundancy I would lose. I would be responsible for everyone elses even if I let them go on week 1. TUPE means redundancy pay goes all the way back to start of contract before takeover. It's a risk too far.

    No, it's the location and the established nature of the business. Starting from scratch elsewhere would be set me back a 2-3 years from where we are at now.
  9. Gordon Gekko

    Gordon Gekko Frequent Poster

    There’s more than one way to skin a cat.

    If he doesn’t have to pay redundancies if you buy it, then surely that’s reflected in the price?

    And can you get the staff to take haircuts in order to preserve their jobs?
    Purple likes this.
  10. Jim Stafford

    Jim Stafford Frequent Poster

    TUPE is the biggest obstacle to many business sales as it so onerous on the purchaser.

    You do not say if the owner is a sole trader or a limited company. If your employer is a limited company is it planning to go into an insolvent liquidation? If so, you might be able to buy the assets from the liquidator and start the business again without any responsibilities to the prior employees, provided the employees were made redundant in advance of the liquidation and your purchase of the assets was not "pre-planned."

    Alternatively, as Gordon Gekko suggests, your employer might provide a hefty discount on selling the assets in order to avoid having to pay redundancy costs.

    Jim Stafford
    RETIRED2017 likes this.