TUPE and P45

Tupe process and P45 issued

Didn't find your answer?

The company I work for is in the process of selling the side of the business unit I work for. A TUPE process started but on the 31st of May the company issued P45 for all the employees (around 190 people are affected by this). On my HMRC page it shows that my employment has ended. My questions are, can a P45 be reversed? If not, do I need a new contract? Because the P45 was issued does this means the TUPE is no longer applicable as we are officialy unemployeed? Many Thanks Tania

Replies (9)

Please login or register to join the discussion.

avatar
By paul.benny
07th Jun 2024 14:37

Not really an accounting question but here's a few comments

If your business unit is now under new ownership, it's likely that the new owner will transfer payroll to their own systems. To do this, former owner will mark all as leavers and issue P45 - but I wouldn't expect those to be handed to employees.

TUPE is an legal obligation that employers cannot easily evade. What have you all been doing since 31 May? Working same as before with a different name over the door?

Did the P45 come out of the blue? That would suggest they've not only disregarded TUPE but all other legislation concerning redundancy.

I think ACAS have an employee helpline you could contact.

Thanks (0)
Replying to paul.benny:
avatar
By Taniamnvieira
07th Jun 2024 14:53

We received the P45's (all employees) but we were not communicated about it, as someone found by accident that we had the P45's on the platform we use for payslips. I can print mine if I need.
Because of people working on VISAS the process of moving to the new owner has been delayed, so "technically" we are working for the old company, even if they gave us a P45 and no new contract was signed. We've just been told that we still employees of the old one and next month we'll be transferred to the new one. June 's wages are going to be paid by the old company... as we apparently still working fo them.

Thanks (0)
Replying to Taniamnvieira:
avatar
By paul.benny
07th Jun 2024 14:58

So oldco will have to put everyone on their payroll as starters and then as leavers with another P45 when you eventually transfer to newco. The P45s are essentially administrative and employer should have explained to you.

Thanks (2)
Replying to paul.benny:
avatar
By Taniamnvieira
07th Jun 2024 15:09

Yes, exactly that.
So, we don't need to worry about this, we will not lose our rights and our employment will be continuous throughout the entire process.

Thanks (0)
Replying to Taniamnvieira:
Stepurhan
By stepurhan
07th Jun 2024 15:38

You should not have to worry about TUPE.

However, I would consider the way this has been handled a concern if I were you. They handed out P45s to TUPE employees, which they should not have done. They did not communicate properly about what has happened. They have initiated the transfer to the new owner but the new owner is not yet ready to take on the employees being transferred. I would worry about the competency of management with that many mistakes on a relatively simple matter.

Thanks (1)
Replying to stepurhan:
avatar
By Paul Crowley
07th Jun 2024 15:45

It looks really shabby and incompetent.
Is this division really just being pushed to a 'buyer' that will fall flat and not impact on the other part of the company.

Thanks (0)
Replying to paul.benny:
avatar
By SXGuy
07th Jun 2024 17:07

Or they may process June as outside P45 using a T code.

Thanks (0)
avatar
By FactChecker
07th Jun 2024 16:15

There's several different aspects to this situation/question - relating to Employment and to Payroll (and in both those cases their onwards impact on individual rights and on HMRC records).
The 'good' news is that there are 190 affected people, and that is a big enough group to seek some professional advice (based on the specific circumstances which may well not be as straightforward as usual if there are issues like Employer-specific work visas in play).

In brief ...
* "a TUPE process started" - this needs to be properly clarified (i.e. who was running it? / what is in writing? / has it actually stopped?)

* "on the 31st of May the company issued P45 for all the employees" - did they do or communicate anything else (regarding termination of employment)?
[a P45 is just a bit of 'paper' at end of the day, it doesn't of itself end an employment contract even if it shouldn't have otherwise been issued.]
Of more concern, although hard for an employee to find out, is whether the 'end date of employment' was submitted by the old employer to HMRC via the FPS?
[If so, they *should* issue a corrective FPS to HMRC - which will also make it easier for them if they apparently have another tax month to process/pay/report.]

* "can a P45 be reversed?"
As above, a P45 cannot 'be reversed' BUT the old employer can submit a corrective FPS that removes the 'employment end date' value from your record at HMRC.
However that's only necessary/desirable because you say they actually need to pay you for a further month.
Once you've ceased employment for that company the correct date for that should be submitted by the old employer to HMRC - but they don't need to give you a P45 if they know your employment is being 'transferred' under TUPE.
The key is that even under TUPE you ARE being employed by a new entity (as a new starter on their payroll under their PAYE scheme) but WITH continuity of all your employment rights from the old employer (including the date for LoS calculations).

* "If not, do I need a new contract?"
Yes - as above, you will have new employment with a different employment (so need a contract for that).
What TUPE is meant to ensure is that the terms of your new contract cannot worsen the terms of your old contract - and your length of service (which matters for all sorts of reasons) will be based on when you started with old employer.

THE KEY thing right now is what I posed in my first bullet-point above:
* "a TUPE process started" - has it actually stopped?

Thanks (2)
avatar
By SXGuy
07th Jun 2024 17:10

Sounds to me they started the process of transferring you all over before the other side were ready and complicated things by providing you with a P45 that should really have been for internal use only.

If they are paying June's wages on behalf of newco then hopefully they will sort out the payslip and tax code for the additional period correctly.

But apart from that I can't see as yet any foul play from anyone.

Thanks (0)