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TUPE and Redundancy: Your Rights When Your Employer Changes

When a business is sold, outsourced, or a service contract changes hands, the Transfer of Undertakings (Protection of Employment) Regulations 2006 — known as TUPE — automatically transfer employees to the new employer on their existing terms and conditions. But what does this mean for redundancy? Can you be made redundant under TUPE, and if so, what are you owed?

What does TUPE protect?

TUPE preserves your continuous employment, your pay, your holiday entitlement, and most other contractual rights. The new employer steps into the shoes of the old one. This matters for redundancy because your length of service carries over — years worked for the old employer count towards any statutory redundancy pay entitlement just as if you had always worked for the new employer.

Is redundancy automatically unfair under TUPE?

Not always, but the bar is high. The law says that a dismissal connected to a TUPE transfer is automatically unfair unless the employer can show an Economic, Technical, or Organisational (ETO) reason that entails changes in the workforce. Simply wanting to cut costs, harmonise pay, or remove duplicate roles because of the transfer is not enough on its own.

Examples of genuine ETO reasons that courts and employment tribunals have accepted include:

  • Closing a site that was always planned to close regardless of the transfer
  • Restructuring that would have happened without the transfer (for example, a declining market)
  • Genuine over-staffing that cannot be absorbed and that existed before the transfer was contemplated

If the employer cannot demonstrate an ETO reason, affected employees can claim automatic unfair dismissal regardless of their length of service — the usual two-year qualifying period does not apply.

Redundancy before or after the transfer?

The timing matters. If you are made redundant by the old employer before the transfer, TUPE may still apply. If the dismissal is connected to the transfer and lacks an ETO reason, it is treated as automatically unfair even though the old employer carried it out. Courts look at the substance, not just the timing.

If the redundancy happens after the transfer and the new employer has a genuine ETO reason, it can be a fair redundancy — provided the employer follows a proper consultation process and selection procedure.

Collective consultation under TUPE

Both the old employer and the new employer must collectively consult employee representatives (trade union representatives or elected representatives) before the transfer. This is separate from, but often runs alongside, the individual consultation required for any planned redundancies. Failure to consult properly can result in a protective award of up to 13 weeks' pay per affected employee.

How much redundancy pay are you owed?

Provided the redundancy is lawful (either genuinely ETO-driven or connected to the transfer but with a fair procedure), you are entitled to statutory redundancy pay on exactly the same basis as any other redundancy. The calculation uses:

  • Your combined length of service — including time with the old employer
  • Your age at each year of service
  • Your weekly gross pay, capped at £751 for 2026/27

The age-band multipliers are: half a week's pay per year under age 22; one week's pay per year aged 22 to 40; one and a half weeks' pay per year aged 41 and over. Your employer may also offer an enhanced redundancy package — check your contract.

Use our redundancy pay calculator to get an instant figure based on your combined service and current pay.

Changing terms after a TUPE transfer

A connected issue is that the new employer cannot simply cut your pay or worsen your terms as part of the transfer. Any variation to your contract that is connected to the transfer is void. Employers who pressure employees to accept worse terms, or who manufacture a redundancy to re-engage on worse terms, are likely acting unlawfully.

What to do if you think your TUPE redundancy was unfair

If you believe the redundancy was connected to the transfer and lacked a genuine ETO reason, you have the right to bring an employment tribunal claim for automatic unfair dismissal. The time limit is three months minus one day from the effective date of termination (ACAS early conciliation pauses the clock). You do not need two years' service to bring an automatic unfair dismissal claim under TUPE.

Seek independent legal advice from a solicitor or contact ACAS for free guidance. GOV.UK also has detailed guidance on business transfers and takeovers.

Summary: TUPE redundancy at a glance

  • Your continuous service carries over to the new employer
  • Dismissal connected to a TUPE transfer is automatically unfair without a genuine ETO reason
  • ETO reasons must entail changes in the workforce, not just cost-cutting
  • Statutory redundancy pay uses your full combined service length, capped weekly pay of £751 (2026/27)
  • Tribunal claims for automatic unfair dismissal require no minimum service length
  • You have three months minus one day to bring a claim

Use our free redundancy pay calculator to estimate your statutory entitlement, then seek specialist employment law advice if you believe the redundancy process was unfair.