8.1 PPP requires careful consideration to be given in each case to the definition of service to be contracted, and the impact on employees' interests. It is not an automatic requirement of PPP to transfer employees, although the defined contracted service will normally include some services currently carried out by public sector employees. The circumstances of each case will vary. Where there is a transfer of undertaking employees must be told immediately. They must be advised in writing of the intention to transfer employees, when such a transfer might take place and that TUPE (and other guidance on pensions) will apply. When TUPE does not apply in strict legal terms the principles of TUPE should be followed.
8.2 Bidders must have drawn to their attention, in writing, the intention that employees will transfer, that TUPE (or the principles of TUPE) should apply and that employees will be able to maintain pensions broadly equivalent to those they currently receive. So far as PPP is concerned this requires that:
• transferring employees should be offered a broadly comparable pension by the new employer, both on initial transfer and at second and subsequent contracting rounds
• the new employer's pension scheme should allow transferring employees the option of moving their accrued credits into that scheme on a fully protected basis
• instructions for the involvement of the Government Actuary's Department in assessing broad comparability and bulk transfer agreements should be followed.
• Where possible, transferred employees should continue to have access to the PSO's pension scheme through admitted body status arrangements.
8.3 Bidders should be also advised that they can, if they wish, submit non-TUPE bids but that these will only be accepted if they fall within an agreed set of genuinely exceptional circumstances (as described in the Cabinet Office Statement of Practice).
8.4 These exceptional circumstances are broadly:
• where the activity is essentially new or a one-off scheme, or
• where goods or services are essentially a commodity bought "off the shelf and no grouping of employees are specifically and permanently assigned to a common task, or
• where the features of the service or function subject to the contracting exercise are significantly different from the features of the function previously performed within the public sector, or by an existing contractor e.g. a. function to be delivered electronically and in such a way that it requires radically different skills, experience and equipment.
8.5 Bidders must be advised that employees and their representatives will be involved in discussions about the transfer as early as possible in the process in accordance with the provisions for employee involvement and consultation set out above.
8.6 Contractors and recognised trades unions should work in a spirit of partnership on the full range of staffing issues associated with the transfer. All parties should agree to work reasonably. To underpin this all parties should negotiate, with a commitment to reaching agreement on a structured disputes procedure to enable the effective resolution of differences.
8.7 Once final decisions have been taken on the way forward regarding any transfer, employees and trades unions must be told as soon as possible of the outcome. It is particularly important to make clear what, if any, direct impact there will be on particular staff groups and individuals. It is expected that project teams, trades unions, and personnel departments will work closely and constructively in these processes in the best interests of consultation, communication, and employee welfare.
8.8 If there is to be an external contract, employees must be advised as early as possible about proposed terms and conditions and transfer date. These must be in line with the earlier statement on complying with TUPE, pensions and other guidelines, including employee representation.
8.9 Every effort will be made to minimise the disruption for the employees involved who will be given written confirmation of terms and conditions, transfer dates and all other relevant information at the earliest opportunity.
8.10 The PSO will discuss and agree, at the earliest opportunity and through local consultative and/or partnership machinery, what options are available to employees who do not wish to transfer to the new employer. This will be expected to include application of redeployment policies and procedures.