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European court rules contractual terms frozen on TUPE transfer

19 July 2013

Yesterday, in a decision which has significant implications for academies, the ECJ gave their decision on whether terms and condition of employees working under a 'collective agreement' should automatically change as amendments to the collective agreement are negotiated, or whether the terms should 'freeze' on transfer. They decided the latter.

The case of Alemo-Herron and Ors v Parkwood Leisure Ltd involved an employee of a local authority who had been transferred to a private company. He argued that he should automatically be entitled to the pay rise that he would have been awarded, if his employment hadn't been transferred.

The court found that to impose contractual changes on employers who are not a party to the negotiations would limit the "very essence of its freedom to conduct a business".

This ruling means that academies will not automatically be bound by pay rises agreed by local authorities for their non teaching staff.

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