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UKSolicitorJA, Solicitor
Category: UK Employment Law
Satisfied Customers: 4312
Experience:  solicitor
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I recently re-occupied my business premises, I sold the business

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I recently re-occupied my business premises, I sold the business a gym on the 31st August last year the new owners paid for all the fixtures and fittings plus the goodwill of business and as I own the building a brand new 6 year 11 month Lease, was granted, the new owners are now in several defaults of the Lease rent arrears of over £15k for eg, and voluntarily without notice left the building on the 18th April, on the 19th April I secured the building and closed the business.
I re-opened on the 22nd April, in an effort to keep the business trading and look for a new Lease holder/ business occupier, basically as a caretaker, my potential problem now is the existing employee's 2 of which are owed between 1k and 2kin wages, 1 employee is also eligible for reduntancy, given the TUPE regs would I be liable for these issues even though I am only operating the business on a temporary footing whilst looking for a buyer, if I close the doors and shutdown, the existing membership will disappear and effectively there would be no business to sell, to recover my losses and protect the employee's jobs, could I set up a new Ltd Company to run the business in the short term to protect myself from any involvement with the past employment issues directly related the their recent employer and TUPE regs
Regards XXXXX XXXXX (07771588477)

I would agree with the local Solicitor that TUPE probably does apply in this case, however, the burden of showing that TUPE applies is on the employees, not you.

The Employment Appeal Tribunal in the case of LOM Management Ltd v Sweeney held that the employee must “…show not only that the lease transferred but that there was, on the facts, a business also transferred which was intrinsically linked to the property and satisfied the definition of economic activity [in TUPE]”.

I am afraid the LTD company route you propose would probably also be caught by TUPE i.e. I see no viable route of escape if you continue to run the business.

Hope this helps

Customer: replied 3 years ago.
Could I offer a compromise figure
as a one off payment, as a full and final settlement, effectively drawing a line and starting again, none of these employee's have ever signed or entered into any employment contract.

Yes, you could enter into a compromise agreement with the employees whereby they agree to waive any claims and agree that they employment ends in consideration of payment to them of an agreed sum of money.

It does not matter that they don't have any employment contracts, they are still protected by law.

Your local solicitor may be able to help with the agreement. The employees will also require independent legal advice for the compromise agreement to be effective.

All the best -please leave feedback
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