BT and Openreach have completed what is thought to be the largest one-off Tupe transfer of employees in UK corporate history, moving 31,000 people – including thousands of broadband network engineers – across to the legally separate Openreach broadband network business.
The Tupe, or Transfer of Undertakings (Protection of Employment), regulations are designed to protect the employment rights of employees who are being transferred from one business to another, usually during a merger or acquisition. Based on European Union (EU) law, the regulations were codified in the UK in 2006, replacing previous legislation.
The transfer fulfils a major part of BT’s and Openreach’s commitments to regulator Ofcom made under the Digital Communications Review of 2016, which forced the legal separation of the two firms on the basis that BT had too much control over Openreach, which was disadvantageous to other communications service providers (CSPs).
“Openreach now has its own board, greater strategic and operational independence, a separate brand and an independent workforce – and we’re ambitious for the future,” said Openreach chairman Mike McTighe.
“We have set out a clear plan to invest in new, more reliable, future-proof broadband technology, and we’re right in the middle of our largest-ever recruitment drive for 3,500 engineers – so it’s an exciting time to be part of Openreach Limited.
“We are determined to continue improving customer service, collaborating closely with our customers and spearheading the national roll-out of next-generation broadband networks.”
BT and Openreach have both been working closely with the relevant trade unions to make the transition as smooth as possible for those affected by the split, and conducted a lengthy consultation with union reps and employees earlier this year.
Openreach pointed out that Ofcom had pronounced itself satisfied with positive progress towards implementing the commitments made. The regulator released a report in June 2018 as part of its ongoing monitoring of the separation, which noted that the Tupe process had been held up by now-resolved complexities arising through BT’s pension scheme, which is a frequent source of angst for the wider BT Group.
But at the same time, the regulator said there were still some problem areas, notably around the true ability of the Openreach board to make decisions independently of BT. According to Ofcom, emails it has seen between unnamed senior executives have given it cause to believe that BT is “significantly involved” in Openreach’s financial planning process, and it may not yet be as free from BT’s influence as it has claimed.
At the same time as the completion of the Tupe transfer, the Northern Ireland Networks division is being rebranded as Openreach Northern Ireland. This division already has the same responsibilities to deliver network products and services in Northern Ireland, and said the change would enable it to continue to focus on “providing better, broader and more reliable connectivity” for its customers in the region.