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cityguru, Solicitor
Category: Employment Law
Satisfied Customers: 13329
Experience:  Senior lawyer with 30 years experience
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Hi Please could you help. Our company is a charity

Customer Question


Please could you help.
Our company is a charity and our role is a payroll bureau. Our clients are self employed who are in receipt of funds from local authorities to employee people to provide them with care, this is classed as a small carers scheme.

Our company has done a review and we no longer fit in their new mission. We were given 3 options, 1. to let the contract run to the end - this doesn't apply to our project as the clients contract is directly with us. 2. Tupe us across to another provider which is possible for 58% of the clients but again they would have to agree, the remaining 48% would be left in limbo. Every client that agreed to move would have to sign a form to authorise the new provider to deal on their behalf with HMRC, they would have to sign a new service level agreement and direct debit mandate. As the clients have various needs due to their disability this could take a minimum of three months, also once the clients have signed only the new party could act on their behalf. The 3rd option was to set up our own CIC company. We stated however that we would do this as our final option on the condition that we were made redundant and had our redundancy pay, we also requested a list of 'wants / needs' . When we sent this in writing we were told it was agreed in principle though the 'wants / needs' would have to be discussed. We have had a couple of meetings with Wales Co-operative Centre that help set up not for profit organisations and have gone quite a way down the line in setting this new business up. We have now been told today that they do not want to pay our redundancy but would consider underwriting it ? The goal posts are moving constantly. Where do we stand? and by agreeing on principle having seen the request that we would go ahead on condition of redundancy pay have they broken any agreement. We did seek legal advice and was told that we should not voluntary agree to set up a business, that they had to make us redundant, that is why we specifically specified we would only set up ourselves on the condition that is was our organisation that was making our job redundant. Today we were told that our job was not redundant and that we were basically being Tuped over to another business and therefore not redundant (though that business is the one we were setting up at our risk.
Submitted: 4 years ago.
Category: Employment Law
Expert:  cityguru replied 4 years ago.
Thanks for your question. I agree with the advice that you have been given. If you set up a company even a non profit and then transfer your current activity to it, then there will almost certainly be a TUPE transfer.

It is theoretically possible for your existing employer to make you redundant and make a redundancy payment and then reengage you or allow you to transfer the business but the problem with TUPE is that is operates as a matter of law regardless of what the parties agree so you would need to all sign formal settlement agreement to waive any claim.

If you have not actually set up the business then do not do so until after you have been given notice of redundancy.

Alternatively I would ask you employer to fund the legal costs to get it all set up in the right way.