Early termination of contract and TUPE

[accesshouse]

Our company has been working at 2No AWE sites carrying out specialist maintenance work. The contract was awarded to us 8 years ago by a facility management company who were acting as the main contractor. Typically we are awarded 1 year orders and are currently into the first 2 months of the latest order.

Throughout the contract we have won safety awards and carried out all phases of work within budget and to programme, last week however we had a bombshell dropped on us from our site agent who explained he had just been informed that our contract was being terminated within 4 weeks and all of our staff were to be TUPE transferred to the facility management company who have 3 to 5 years left on their contract.
I was also informed that a letter was in the post informing us of the termination and that TUPE consultation was already in progress with our employees and the Site Union rep in attendance.

I immediately contacted the facility management company who explained they could make more money by recruiting our staff directly and incidentally had authorization from the client to proceed along these lines. (Not 100% certain this is correct) and will ask the ultimate client.

We have been through TUPE on many occasions so fully understand the procedure and there is a clause in the contract giving 1 Months notice for termination.

Coincidently, this happened to us 2 years ago on another Site, however as we had a particularly loyal workforce they informed the other party that they wished to opt out of TUPE and as a result we had our contract renewed.

This particular squad of 4 men have been with our company since they were apprentices and have a collective service of 60 years and over that period we have expended massive amounts of training and expense, so its hard to accept that TUPE can be manipulated be another company to acquire skilled workers for the term of their contract. Have spoken to our men and they are concidering the opt in or out, as we have plenty of work and want to retain them, but its out of our hands.

Our particular problem with this situation is that we have a couple of smaller contracts on this site for other contractors and this work would have been carried out by the men due for transfer and it’s not practical to provide other installers as the security clearance takes at least 6 months and costs the ultimate client a great deal, so If we don't fulfill these contracts we may be held for breach.

If this practice becomes more widespread then I would prompt other sub contractors to be very careful of accepting a service or long term contracts without seeking legal advice, because as things stand they could be 1 to 2 months into a 10 year project for example and then have their contract terminated and then wave good bye to their employees and its all legal !.

Any advice

[scooby]

Our company has been working at 2No AWE sites carrying out specialist maintenance work. The contract was awarded to us 8 years ago by a facility management company who were acting as the main contractor. Typically we are awarded 1 year orders and are currently into the first 2 months of the latest order.
Throughout the contract we have won safety awards and carried out all phases of work within budget and to programme, last week however we had a bombshell dropped on us from our site agent who explained he had just been informed that our contract was being terminated within 4 weeks and all of our staff were to be TUPE transferred to the facility management company who have 3 to 5 years left on their contract.
I was also informed that a letter was in the post informing us of the termination and that TUPE consultation was already in progress with our employees and the Site Union rep in attendance.
I immediately contacted the facility management company who explained they could make more money by recruiting our staff directly and incidentally had authorization from the client to proceed along these lines. (Not 100% certain this is correct) and will ask the ultimate client.
We have been through TUPE on many occasions so fully understand the procedure and there is a clause in the contract giving 1 Months notice for termination.
Coincidently, this happened to us 2 years ago on another Site, however as we had a particularly loyal workforce they informed the other party that they wished to opt out of TUPE and as a result we had our contract renewed.
This particular squad of 4 men have been with our company since they were apprentices and have a collective service of 60 years and over that period we have expended massive amounts of training and expense, so its hard to accept that TUPE can be manipulated be another company to acquire skilled workers for the term of their contract. Have spoken to our men and they are concidering the opt in or out, as we have plenty of work and want to retain them, but its out of our hands.
Our particular problem with this situation is that we have a couple of smaller contracts on this site for other contractors and this work would have been carried out by the men due for transfer and it’s not practical to provide other installers as the security clearance takes at least 6 months and costs the ultimate client a great deal, so If we don't fulfill these contracts we may be held for breach.
If this practice becomes more widespread then I would prompt other sub contractors to be very careful of accepting a service or long term contracts without seeking legal advice, because as things stand they could be 1 to 2 months into a 10 year project for example and then have their contract terminated and then wave good bye to their employees and its all legal !.
Any advice

Are you a contractor? If so, you wont be TUPE'd it's irrelevant, it's for permies.

Any contractor accepts that his / her contract can be canx mid way through contract. Do you want to stay on the contract? are you direct or agency? novate the contract and no issues.

Not sure what you are saying or want to know...

[nomadd]

Our company has been working at 2No AWE sites ...

If this practice becomes more widespread then I would prompt other sub contractors to be very careful of accepting a service or long term contracts without seeking legal advice, because as things stand they could be 1 to 2 months into a 10 year project for example and then have their contract terminated and then wave good bye to their employees and its all legal !.
Any advice

I think you misunderstand the basis of this forum. It is aimed (mainly) at Computer Contractors who are employees of their own Ltd companies, and not an employees of someone else's company.

I've worked on a few sites where what is currently happening to you has happened to employees of other management companies. My only recommendation is to speak to your union rep. - if you are in a union. If not, talk to your companies HR Dept. to get a good picture of what is going on and the terms of the new contract you are being offered. If the terms aren't clear, or you are unhappy with them after negotiation, then seek professional legal advice.

[mudskipper]

I think OP is director/owner of a company with emloyees. His(her) employees are being tupe'd without any consultation with him and there's nothing he can do about it.

Agree, this probably isn't the right forum - but sounds like a crappy situation if that can happen.

[SueEllen]

Unfortunately we aren't a legal forum. I think you really need to contact a solicitor who will look at your contract.

You've basically openly admitted you didn't seek legal advice over your contract before you signed it which is where you are coming unstuck now.

You have probably agreed somewhere in the small print that either the client or the main subcontractor can steal your employees.

[Incognito]

Any advice

IANAL, but from your description this would come under the new 2006 regulations concerning "service provision changes" (A change of provider of a service and an organised grouping of workers whose principal purpose pre-transfer was carrying out the service now being transferred). There is a specific test that applies to this type of scenario, the most important point for you to concentrate on (going by the info in your post) would surround the principal purpose of those four men. As other people have said though, consult a lawyer about this.

Unfortunately the law is geared up around the thinking that business to business relationships are normally conducted at face value, i.e. you accept the inherent risk in your business dealings.