Transfer of Undertakings

European Communities (Protection of Employees on Transfer of Undertakings) Regulations, 2003

The goal of these Regulations is to protect the rights of employees in the case of a legal transfer or merger of an undertaking, part of a business or business to a new employer.

The Regulations:

  • In the case of a transfer, the new employer will take on the staff that is under an employment contract or obligation. The employees maintain all of the rights and obligations they had under the contract with the original employer.
  • All of the collective agreements will remain in force and the new employer will have to abide by those agreements. The agreements will remain in force until they expire or until other agreements that supersede them are made.
  • The new employer will have to protect the interests of persons and employees that were no longer employed in the business of the original employer at the time of the transfer, and due to old age, survivor’s benefits, invalidity, under inter-company pension schemes, or supplementary company pension outside of the Social Welfare Acts.
  • While employees cannot be dismissed due to the transfer of business, part of a business or an undertaking, they are not protected in the case of technical, economic or organisational alterations in the workforce.

In the case of a serious detrimental effect to the working conditions of employees who are involved in the transfer of the business, part of a business, or an undertaking, the concerned employer is the one that is responsible for the dismissal.

Both the new employer and the original employer have to consult their respective employees 30 days before the transfer happens at the latest. Furthermore, in any event, it has to be in good time (for new employers) and before the transfer affects the employees directly. The employers have to consult their employees about things concerning:

  • The cause of the transfer
  • Social, economic, and legal implications of the transfer that the employees will experience
  • The measures envisaged in relation to the employees.

If the new or old employer involved in a transfer envisage measures in relation to their employees, they must consult representatives of the employees where reasonably practicable, 30 days before the transfer occurs at the latest. In any event, it has to be in good time in regard to those measures. The consulting has to come up with a plan to seek an agreement with the representative of the employees. Representatives are staff associations, trade unions or excepted bodies that have a history of bargaining negotiations with the employer. Other forms of representatives are those that the employer puts in place from the numbers of his employees to represent the employees in the negotiation in the case of absence of trade unions, staff associations or excepted bodies.

An employee or trade union, staff association or excepted body on behalf of an employee have the ability to file a complaint to the Rights Commissioner in the case that the employer does not comply with existing regulations that are being carried out in relation to consultation and information that the employee is entitled to.