Whether you work for a travel management company, or you’re the owner of one, you will be affected by changes to European laws.
From April, tightening of regulations will mean if a TMC wins a new account, it is forced to employ anyone who is dedicated to that account who works for the outgoing company. Let’s set the scene.
you’re a travel management consultant working in an American Express implant in a bank in the City. One day, the bank decides to switch its business travel account to Carlson Wagonlit Travel.
you’re the owner of a small travel management company that’s won a new account in Northampton. The TMC that currently handles the account employs two staff at its Northampton branch, but in your pitch you have proposed to run the account from your offices in Birmingham.
What happens next in both cases is governed by the Transfer of Undertakings Protection of Employment, better known in the industry as TUPE.
Like many pieces of legislation, it’s not straightforward, but in general if a TMC wins a new account, it has to take on any of the outgoing agents’ staff if they are dedicated to that account. And from April 1, this legislation is being tightened. That means it is even more imperative that employers and employees alike know where they stand.
In general, corporate travel management accounts run for three years before they are put up for tender and could change hands. Some of the larger accounts run for four to five years. “This legislation will be extremely important next year when the travel accounts of local and central Government are all being brought together,” said Sue Kavanagh, director of human resources for Carlson Wagonlit Travel.
“At the moment they are decentralised, but the Government is trying to gain buying power by bringing them all in to one deal. When this happens, a huge number of accounts will be changing hands.”
Here is some advice for employees, and also for employers, who might find themselves affected.
When an incoming agent is required to take you on, it must offer you the same package as you enjoyed under your previous employer. So you must be placed on the same salary and be offered the same benefits in terms of holiday entitlement or health care.
In some cases, this might mean the incoming agent has to provide you with a better package than it gives to its existing staff. In cases where you are on a lesser package, it might decide to upgrade you to the same level as the rest of its workforce. Make sure you are aware of exactly what you are entitled to.
Under the changes coming in from April, companies must follow a formal consultation procedure with all affected staff. If they do not follow this procedure, you may be able to take legal action against them and they will be fined.
Take notes at all meetings and do not agree to anything before you are completely sure that you are happy with your decision.
If the change of employment means you will have to relocate to a different town or city, or have a longer commute to work, think carefully before you accept. It might be possible for you to negotiate to stay with your old employer, or to transfer to a role with the incoming agent that is closer to home.
If you don’t want to switch to another employer, but you don’t have another job to go to, it might be worthwhile sticking with the job until you have secured another position. It might not be long before a position becomes available at your old company that suits you.
The human resources department of both your existing employer and the incoming company will be able to provide you with information on your rights. Make full use of its expertise.
When you tender for a new account, there will now be much more transparency in the information you can obtain from the existing agent.
It pays to know exactly what information you are entitled to ask for. As soon as you win a new account, the TUPE legislation dictates which information you are entitled to, when you can get it, and how quickly you can begin discussions with staff.
Make sure you follow the correct procedures when consulting with employees. Under the changes, if you do not follow these procedures you risk being fined.
Be aware pensions are included in the benefits you must provide to the staff you inherit when TUPE is applied. Although it does not have to be exactly the same pension scheme, it has to be above a minimum level set by the legislation. This may, of course, add significant costs on to your business.
If you are a small company that doesn’t have a dedicated human resources department or legal department, contact a local law firm for advice.
Some legal companies run workshops which outline the changes taking place in April. Try Cobbetts.co.uk. Also check out the Department of Trade and Industry website Dti.gov.uk for more information.
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