Administrations And TUPE In The UK

It's been quite a week for important cases on TUPE and its operation in relation to administrations. The Court of Appeal has delivered two judgments which are of considerable importance for those contemplating and structuring transactions out of administration.

The key points to note are that:

• TUPE always applies to transactions out of administration which otherwise fall within its scope; and
• an employee who is dismissed by administrators prior to a sale but when there was no particular transaction or purchase in existence or contemplation can argue that his or her dismissal was transfer connected and therefore potentially automatically unfair as well as being a liability for which the ultimate acquirer of the business is responsible.