Many local clients are considering buying or selling a business and, in doing so, secrecy is paramount. If details get out, the deal can be scuppered so it is important to keep things under wraps to protect relationships with customers and suppliers. In some cases, employees will be inclined to leave if they get wind of a deal in the offing.

In the current economic climate some sales are forced due to liquidity problems and some buyers are snapping up businesses or assets. Some people often do not properly consider the legal side of the sale and purchase of a business. In June, the Information Commissioner’s Office (ICO) published new guidance to help organisations comply with the Data Protection Act when providing information about their employees under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).

TUPE ensures that employees’ terms and conditions of employment are preserved when a business or undertaking is transferred to a new employer. To achieve this, TUPE requires that certain information is provided to the new employer before the transfer takes place. This will include details of pay, contracted hours, holiday entitlement and any details of disciplinary or grievance action relating to that employee. The Data Protection Act does not prevent the transfer of this information as it is a requirement by law. However, both parties must comply with the Act when handling the information, for example ensuring it is accurate, up-to-date and secure.

If you are considering buying or selling a business and would like a competitive quote, contact Cathy Cook at our Wakefield office in West Yorkshire

E: Cathy Cook

Additionally, Phil Jones, Assistant Commissioner at the ICO, said:
Organisations should consider their data protection obligations early in the transfer process and only transfer the information required by the new employer. Additionally, if not prevented by insider trading restrictions, employees should be told that their information is going to be passed on.


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