In the case in question, Eastport News’s transfer to a new owner corresponds to the TUPE transfer category. In this regard, Giles Byline, its current owner and editor-in-chief, must consider specific legal and employment aspects.
Firstly, from a legal perspective, the TUPE transfer does not imply a change in the status of employees who are entitled to retain employment. Secondly, no related criteria, including the size of the new company, should be factors in determining job retention. This means that until Eastport News becomes the full property of Westpress Ltd., Mr. Byline has no right to fire employees or offer them to leave voluntarily due view of upcoming changes.
This is unlikely to happen because Eastport News staff respects and values their permanent leader. However, due to retirement and a number of business challenges the company has faced recently, the corresponding changes are inevitable, which explains the need to adhere to the legislative aspects of the transfer.
At the same time, given TUPE’s legislative background, Mr. Byline has to take into account the proposed transfer conditions. Westpress has made it clear that once Eastport News becomes their property, a number of employees will not be guaranteed a job.
Moreover, the new company has expressed specific desires to cut Eastport News’ staff by a third over time. Giles will not be able to influence this decision as he will no longer be the owner and will have no rights over his past business. According to Bernstein, restrictive covenants are not enforceable if the business structure changes and is managed by a new owner.
For Eastport News, this means that its current owner does not have the authority to provide his subordinates with guaranteed jobs in the future, and the only thing he can ensure is their employment at Westpress at the initial stage. The new company has the right to dispose of available resources, including the workforce, freely after the TUPE transfer, which poses risks to the current employees at Eastport News.
From a legal perspective, Giles does not violate any obligations, but from an ethical standpoint, he is responsible for his subordinates with whom he has been working for many years. Given the conditions that Westpress is setting, particularly the downsizing and transition to a new regime of work with an emphasis on online activities, the owner of Eastport News should convey these facts to his colleagues.
As practice shows, trust in managers is an essential performance criterion, and due to his long experience in the family business, Mr. Byline has earned the recognition and authority of his employees. Consultations regarding the future fate of Eastport News, in this case, are unlikely to change the situation.
Westpress speaks about its intentions openly, arguing the proposed business development scenario with the existing market trends and client interests. Therefore, with regard to employment factors, neither party will violate the provisions of the TUPE transfer if the corresponding agreement is signed.
As a result, while taking into account the conditions of the transfer, Mr. Byline needs to consider the nuances of the future of Eastport News and communicate all the aspects of this deal to his subordinates. No changes in the current employment policy should be made since this transfer does not imply a new employment status or additional liabilities from the parties involved.
Given the position outlined by Westpress, there is no need to renegotiate the legal terms because there are no violations in the strategy that the new organization has proposed. Therefore, Giles needs to place a key emphasis on explaining to his colleagues the aspects of the transfer, including its implications.