Asset & Sale Shares
EC (Protection of Employees on Transfer of Undertakings) Regulations
2003.
I, Mary Harney, Minister for Enterprise, Trade and Employment, in exercise of the powers conferred on me by section 3 of the European Communities Act 1972 (No. 27 of 1972) and for the purpose of giving further effect to Council Directive No. 2001/23/EC of 12 March 20011 , hereby make the following regulations:
1. These Regulations may be cited as the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003.
Definitions.
2. (1) In these Regulations –
“Act of 1963” means the Companies Act 1963 (No. 33 of 1963);
“Act of 1988” means the Bankruptcy Act 1988 (No. 27 of 1988);
“contract of employment” means –
(a) a contract of service or apprenticeship, and
(b) any other contract whereby an individual agrees with another person who is carrying on the business of an employment agency within the meaning of the Employment Agency Act 1971 (No. 27 of 1971), and is acting in the course of that business, to do or perform personally any work or service for a third person (whether or not the third person is a party to the contract),
whether the contract is express or implied and, if express, whether it is oral or in writing;
“Council Directive” means Council Directive No. 2001/23/EC of 12 March 2001;
“employee” means a person of any age, who has entered into or works under (or, where the employment has ceased, entered into or worked under) a contract of employment and references, in relation to an employer, to an employee shall be construed as references to an employee employed by that employer; and for the purposes of these Regulations, a person holding office under, or in the service of, the State (including a civil servant within the meaning of the Civil Service Regulation Act 1956 (No. 46 of 1956)) shall be deemed to be an employee employed by the State or Government, as the case may be, and an officer or servant of a harbour authority, health board or vocational education committee shall be deemed to be an employee employed by the authority, board or committee, as the case may be;
“employees’ representatives” means:
(a) a trade union, staff association or excepted body with which it has been the practice of the employees’ employer to conduct collective bargaining negotiations, or
(b) in the absence of such a trade union, staff association or excepted body a person or persons chosen by such employees (under an arrangement put in place by the employer under Regulation 7(2) or 8(5)) from among their number to represent them in negotiations with the employer,
and cognate expressions shall be construed accordingly;
“employer” means in relation to an employee, the person with whom the employee has entered into or for whom the employee works under (or, where the employment has ceased entered into or worked under) a contract of employment, subject to the qualification that the person who under a contract of employment referred to in paragraph (b) of the definition of “contract of employment” is liable to pay the wages of the individual concerned in respect of the work or service concerned shall be deemed to be the individual’s employer;
“enactment” includes an instrument made under an enactment;
“excepted body” has the meaning assigned to it by section 6 (3) of the Trade Union Act 1941 (No. 22 of 1941);
“merger” has the meaning assigned to it by the European Communities (Mergers and Divisions of Companies) Regulations 1987 ( S.I. No. 137 of 1987 );
“Minister” means the Minister for Enterprise, Trade and Employment;
“trade union” means a trade union which holds a negotiating licence under the Trade Union Act 1941 ;
“transfer” shall be construed in accordance with Regulation 3;
“transferee” means any natural or legal person who, by reason of a transfer within the meaning of these Regulations, becomes the employer in respect of the undertaking, business or part of the undertaking or business;
“transferor” means any natural or legal person who, by reason of a transfer within the meaning of these Regulations, ceases to be the employer in respect of the undertaking business or part of the undertaking or business;
“Tribunal” means the Employment Appeals Tribunal.
(2) A word or expression that is used in these Regulations and which is also used in the Council Directive has, unless the context otherwise requires, the same meaning in these Regulations as it has in the Directive.
(3) A reference in these Regulations to a regulation is a reference to a regulation of these Regulations, unless it is indicated that some other regulation is intended and a reference in these Regulations to a paragraph or subparagraph is a reference to a paragraph or subparagraph of the provision in which it occurs.
Application.
3. (1) These Regulations shall apply to any transfer of an undertaking, business, or part of an undertaking or business from one employer to another employer as a result of a legal transfer (including the assignment or forfeiture of a lease) or merger.
(2) Subject to this Regulation, in these Regulations –
“transfer” means the transfer of an economic entity which retains its identity;
“economic entity” means an organised grouping of resources which has the objective of pursuing an economic activity whether or not that activity is for profit or whether it is central or ancillary to another economic or administrative entity.
(3) These Regulations shall apply to public and private undertakings engaged in economic activities whether or not they are operating for gain.
(4) An administrative reorganisation of public administrative authorities or the transfer of administrative functions between public administrative authorities is not a transfer for the purposes of these Regulations.
(5) These Regulations shall not apply to sea-going vessels.
Rights and obligations.
4. (1) The transferor’s rights and obligations arising from a contract of employment existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee.
(2) Following a transfer, the transferee shall continue to observe the terms and conditions agreed in any collective agreement on the same terms applicable to the transferor under that agreement until the date of termination or expiry of the collective agreement or the entry into force or application of another collective agreement.
(3) Subject to paragraph (4), this Regulation shall not apply in relation to employees’ rights to old-age, invalidity or survivors’ benefits under supplementary company or inter-company pension schemes that do not fall within the Social Welfare Acts.
(4) (a) The interests of employees and of persons no longer employed in the transferor’s business at the time of the transfer in respect of rights conferring on them immediate or prospective entitlement to old-age benefits, including survivors’ benefits, under a supplementary company pension scheme that is an occupational pension scheme within the meaning of the Pensions Acts 1990 to 2003 are protected under those Acts.
(b) The transferee shall ensure that the interests of employees and of persons no longer employed in the transferor’s business at the time of the transfer in respect of rights conferring on them immediate or prospective entitlement to old-age benefits, including survivors’ benefits, under a supplementary company pension scheme, other than a supplementary pension scheme that is an occupational pension scheme within the meaning of the Pensions Acts 1990 to 2003, are protected.
Dismissals and termination of employment.
5. (1) The transfer of an undertaking, business or part of an undertaking or business shall not in itself constitute grounds for dismissal by the transferor or the transferee and such a dismissal, the grounds for which are such a transfer, by a transferor or a transferee is prohibited.
(2) Nothing in this Regulation shall be construed as prohibiting dismissals for economic, technical or organisational reasons which entail changes in the workforce.
(3) If a contract of employment is terminated because the transfer involves a substantial change in working conditions to the detriment of the employee concerned, the employer concerned shall be regarded as having been responsible for the termination of the contract of employment.
(4) If a dismissal of an employee, in contravention of paragraph (1), constitutes a dismissal of the employee within the meaning of the Unfair Dismissals Acts 1977 to 2001 relief may not be granted to the employee in respect of that dismissal both under these Regulations and under those Acts.
Bankruptcy or insolvency.
6. (1) Regulations 3 and 4 of these Regulations shall not apply to any transfer of an undertaking, business or part of an undertaking or business where the transferor is the subject of bankruptcy proceedings or insolvency proceedings.
(2) For the purposes of paragraph (1) bankruptcy proceedings or insolvency proceedings shall mean the following:
(a) proceedings whereby the transferor may be adjudicated bankrupt under section 14 or 15 of the Act of 1988;
(b) proceedings whereby the estate of a deceased transferor may be administered in bankruptcy under section 115 of the Act of 1988;
(c) where the transferor is a partnership, proceedings whereby all the members of the partnership may be adjudicated bankrupt under section 106 of the Act of 1988;
(d) proceedings whereby the transferor may become the subject of a protection order under section 87 of the Act of 1988 where all or part of the property of the transferor vests (under section 93 of that Act) in the Official Assignee for realisation and distribution;
(e) proceedings where the transferor may be wound up under section 213(e) of the Act of 1963;
(3) Notwithstanding paragraph (1), if the sole or main reason for the institution of bankruptcy or insolvency proceedings in respect of a transferor is the evasion of an employer’s legal obligations under these Regulations, the Regulations shall apply to a transfer effected by that transferor.
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