{"id":1724,"date":"2022-01-13T03:27:32","date_gmt":"2022-01-13T03:27:32","guid":{"rendered":"https:\/\/uk.legalvision.com.au\/?p=1724"},"modified":"2022-06-16T01:14:39","modified_gmt":"2022-06-16T00:14:39","slug":"what-happens-to-employees-in-a-sale-of-business","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/business-sale-purchase\/what-happens-to-employees-in-a-sale-of-business\/","title":{"rendered":"What Happens to Employees in a Sale of Business?"},"content":{"rendered":"\n

If you are a small or medium-sized business and are planning on a sale of business<\/a>, you should u<\/span>nderstand what will happen to your employees. Knowing the employment rights of existing employees and the effect of a business transfer is essential as a current employer. This article will outline some of the key considerations you should bear in mind, including your legal obligations.<\/span><\/p>\n\n\n\n

Overview<\/h2>\n\n\n\n

Suppose you are selling a small or medium-sized business. In that case, the number of employees you have tied to an employment contract will affect your b<\/span>usiness s<\/span>ale negotiations. It can influence the purchase price and how attractive your business looks to potential buyers, as well as the value of your business<\/a>. In addition, having existing employees can help the new business owner save time and money in recruiting. <\/span><\/p>\n\n\n\n

Generally, the law on what happens to employees is relatively straightforward. Usually, employment contracts are transferred to the business’s new owner, and the employees will continue with the same contract terms. <\/span><\/p>\n\n\n\n

However, there has been a recent change in the law. The government introduced the Transfer of Undertakings (Protection and Employment) Regulations<\/a><\/em> (otherwise known as the ‘TUPE’) in 2014. This article will explain your responsibilities under the TUPE.<\/span><\/p>\n\n\n\n

What Does the TUPE Do?<\/span><\/h2>\n\n\n\n

The TUPE applies when a business is sold to a new owner who will operate with the same identity. This means that the business will be run in the same way as before the purchase.<\/span><\/p>\n\n\n\n

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As this is usually the case when a small or medium-sized business is sold to a buyer, it is likely to apply to you. <\/span><\/p>\n<\/div>\n\n\n\n

The TUPE sets out that:<\/span><\/p>\n\n\n\n