Transfer of property etc
Section 8: Transfer schemes
59.This section enables the Secretary of State or original holding company (Royal Mail Holdings plc), if wholly owned by the Crown, to make one or more transfer schemes. Transfer schemes may transfer property, rights and liabilities (or create interests, rights and liabilities) between:
the original holding company and a subsidiary of that company, provided they are wholly owned by the Crown,
any of those companies and the Secretary of State, the Treasury, a nominee of either of them or another company that is wholly owned by the Crown.
60.The power to make transfer schemes will enable the Secretary of State to ensure that in any restructuring the appropriate property, rights and liabilities are located in the appropriate company in the group. Transfer schemes made by the original holding company have to be approved by the Secretary of State and can be modified by the Secretary of State (subsection (4)). The Secretary of State must consult the original holding company (Royal Mail Holdings plc) before making a transfer scheme or modifying a scheme made by the company (subsection (5)). Under subsection (6), the Secretary of State may also direct the original holding company (Royal Mail Holdings plc) to make a transfer scheme, provided it is wholly owned by the Crown.
61.Subsection (9) requires a company that could be the subject of a transfer scheme to provide the Secretary of State with any information or other assistance that the Secretary of State may reasonably require for the purposes of, or in connection with, the making of a transfer scheme. This duty is enforceable in civil proceedings and overrides any contractual or other requirement to keep information in confidence (subsections (10) and (11)).
62.Further detailed provisions relating to transfer schemes are set out in Schedule 1.
Section 9: Transfer of employees otherwise than under transfer scheme
63.This section ensures that the protections set out in the Transfer of Undertakings (Protection of Employment) Regulations 2006 (SI 2006/246) (“the TUPE Regulations”) will apply to staff affected by the proposed reorganisation of the Royal Mail group of companies. For example, staff working for Post Office Limited are currently employed by Royal Mail Group Limited and seconded to Post Office Limited. Prior to any disposal of shares in a Royal Mail company those staff will need to transfer across to formal employment arrangements with Post Office Limited. This transfer could be effected by agreement between the relevant companies or by transfer scheme made under section 8. Where the transfer is to be made by agreement the provisions in this section will ensure that the TUPE Regulations apply to the transfer. Where the transfer is to be made under a transfer scheme the equivalent provisions are set out in paragraphs 15 and 16 of Schedule 1.
64.Subsections (2) and (3) provide that the section relates to any agreement between companies in the Royal Mail group of companies which are wholly owned by the Crown which provides:
for employees’ rights and liabilities under contracts of employment with one company to be transferred to another company in the group; or
for the cessation of arrangements under which one company in the Royal Mail group of companies provides employees to another company in the group in circumstances where that other company now intends to employ those employees.
65.Pursuant to subsection (4) the Secretary of State may, at any time before any agreement comes into force, designate (by specification or wider description – see subsection (5)) any contract of employment the right and liabilities under which it is agreed are to be transferred and any employee of a Royal Mail group company currently provided to another member of the Group. Pursuant to subsection (6) on the coming into force of any agreement covered by this section the TUPE Regulations will apply in relation to the transfer of the designated contracts of employment or cessation of the provision of designated employees whether or not the provision made by the agreement would otherwise constitute a relevant transfer under the TUPE Regulations. Subsection (7) makes provision for continuity of employment.
Section 10: Taxation provisions relating to re-structuring
66.This section introduces Schedule 2 which contains tax provisions relating to the restructuring of the Royal Mail group of companies.
