However, if the new employer participates in collective bargaining after the transfer, the agreed changes are mandatory for the new employer under the terms of the collective agreement. Former employers should take steps to understand the new employer`s collective bargaining intentions by asking: conditions outside a collective agreement are governed by the standard rules of the TUPE. The new law of January 2014 also made a substantial change in the impact of a transfer on collective agreements. With regard to collective agreements built into the contracts of transferred workers, a “static” approach has now been adopted. Therefore, if a transfer of TUPE occurs after January 31, 2014 and the terms of a collective agreement change after the transition date and the purchaser does not participate in the collective bargaining process that introduced the amendment, the amendment does not apply to transferred workers. In the case of Alemo-Herron and others against Parkwood Leisure Limited, the issue was whether the terms of a collective agreement negotiated through a central bargaining forum had linked a satisfied employer (i.e. the new private contractor) to workers who were transferred to them under the TUPE, although it did not have the opportunity to participate in the negotiations. The British courts disagreed on which of the two interpretations was preferable to the Acquired Rights Directive. Both approaches were as follows: in practice, these specific conditions will bind the purchaser even after the transfer, if certain conditions have been included in a worker`s contract under a collective agreement negotiated between the ceding party and the ceding`s approved union. If, for example, conditions relating to the agreed additional wage increases were included in the employment contract over a period including the additional period, the purchaser is bound by these additional wage increases. However, this is not the case where a general concept, which refers to collective agreements negotiated from time to time, has been included in the contracts of the menting workers (as in this case). In these cases, all new rates of pay negotiated after the transfer by the ceding and the licensed syndicate of the ceding company, in circumstances where the purchaser is not involved in the negotiations, do not bind the purchaser if the renegotiated terms include a new collective agreement (as in this case). Parkwood appealed to the Court of Appeal (CA).
The Board decided that it was bound by the judgment of the European Court of Justice of Werhof/Freeway Traffic Systems GmbH – Co. KG  IRLR 400, which had decided that the terms negotiated by a third party (here the Council as the applicant`s former employer) applied only to the contracts of the transferred workers until the expiry of the corresponding collective agreement, the end or the replacement. The ECJ`s explanatory statement was based on Article 3 of Directive 77/187/EC on acquired rights (now Directive 2001/23/EC). Article 3, paragraph 1, provides that the rights and obligations arising from an existing employment contract at the time of the transfer are transferred to the purchaser.