An employee can enforce new employment terms agreed with a transferee following a TUPE transfer. The Court of Appeal has ruled that an employer cannot avoid being bound by changes it has agreed by arguing that they are transfer-connected and therefore void. It is only transfer-connected changes to the employee's detriment (in his eyes) that are void.
This decision seems to allow employees to cherry-pick the best terms from their old and varied contracts. The EAT suggested that employees seeking to reinstate original terms might have to "give credit for benefits" under the varied contract, but this was obiter and not addressed by the Court of Appeal. Employers could consider only offering new contractual terms on the basis that the employee will revert to his original contract should he seek to rely on any of his original terms (assuming reversion would be feasible on a practical level). This may dissuade employees from seeking to do so, provided the new contract is more favourable overall. (Regent Security Services v Power, CA)
The transferee should ensure that it is clear how any new contractual benefits it offers will be applied to transferring employees, particularly where entitlement depends on when employment started. In a recent case, a transferee's redundancy scheme provided that employees who had "joined" before a certain date were entitled to an enhanced benefit. The Court of Appeal ruled that employees who had been employed by the transferor before that date and TUPE-transferred to the transferee after that date did not fall within this description. This was notwithstanding that employees are deemed for statutory purposes to have been employed by the transferee from the start date of their employment with the transferor. TUPE safeguards existing rights and cannot be used to give a transferred employee access to employment benefits other than those to which the employee was entitled before the transfer. Clear drafting will be key to avoid such disputes. (Jackson v Computershare Investor Services, CA)