Transfer of Undertakings (Protection of Employment (TUPE) Regulations – How they apply to bids and tenders

These are regulations in place to protect employee rights across the UK – specifically tailored to when a business or service transfers to a new owner or service provider. This applies to both the private and public sector and it has implications when people are selling their businesses as well as when there is a change in a service provision. It therefore often applies to businesses that our bid writers here at Tsaks Consulting assist especially when taking on existing staff.

Type applies to all parts of employee wages including wages and salaries, holiday entitlements, length of service and contractual benefits.

It is important to be aware of the TUPE implications in the tendering process, so if you find yourself asking ‘what is TUPE and how does this apply to our bid’ you should conduct more research, ask our team for guidance if necessary. The potential TUPE cost implications may impact your pricing of a bid or tender as you will generally need to accept TUPE requirements and incur any associated costs.

Where does TUPE apply?

TUPE applies to a broad range of scenarios including:

• Business Transfers: This is where a business moves from one employer to another. If the main assets move, then the TUPE responsibilities apply to the new owner. This can sometimes apply in tendering when the tender involves the purchase of a business (or subsidiary)
• Changes in service provisions: This is where there are changes in outsourced services. It can occur through outsourcing, insourcing and retendering. The key point here is retendering. When a client transfers a contract from one contract to another, there are implications in the tendering process. The current employees are generally protected and you need to factor in these costs into your tender price. This can apply to contracts of all different shapes and sizes.

The implications of TUPE on the tendering and bidding process

TUPE regulations have a very large impact on service contracts.

Public sector bids and TUPE

Even for small tenders that small businesses are bidding on, TUPE is important. As part of the tender documentation, the contracting authorities will notify bidders that TUPE may apply. As there is a lot of content in the tender application process, some clients miss this point so our bid writers always ensure we point it out.

The public contractors provide information to bidders on the employees that will be impacted so that when you are bidding, you can incorporate and ‘price in’ this knowledge.

You will generally need to incorporate TUPE into the mobilisation or recruitment plan for the contract if there is no specific question on it.

When you are addressing the implications of TUPE on your bid (or how you will price your bid) you should consider:

• All the employee salaries and benefits
• What any redundancy costs will be if you have to make employees redundant
• Any pension obligations and other obligations such as long service leave.

Then you will need to put forward a coordinated approach to employing staff, and accounting for any costs of employees you will not keep on. Your bid needs to have credibility in the eyes of the reader – this is earned by demonstrating you have thought through the TUPE responsibilities and have incorporated these into your bid.

Other TUPE considerations

There are other legal and contractual issues with TUPE which you should consider including:

• Requirements to inform and consult with any affected employees. You need to incorporate this in any mobilisation plan as it will start prior to the transfer date.
• Taking responsibility for any employment liabilities.
• Payment of pensions and other costs
• Managing the process with the incumbent provider when you win the tender.
• Collecting the details of all employees and the agreements they are one as part of the transfer process (again this needs to be incorporated into any environmental plan.
• It is critical (and a legal requirement) that you communicate with all employees.

Writing bids and tenders that win by showing you understand TUPE and have a comprehensive mobilisation and recruitment plan

Our bid and tender writers can help you write a mobilisation and recruitment plan that demonstrates you will incorporate and understand your TUPE responsibilities. Based in London, Manchester and across the UK, we help businesses write and win contracts.

Not demonstrating you understand TUPE requirements and obligations directly can be a dealbreaker when writing bids and tenders – so it’s important you put forward a comprehensive response and contact our team if you require assistance. We have experience across all industries such as construction, maintenance, health, defence and community services.