Does my length of service count if my company is bought out?

The situation

I have been working as a warehouse operative at a small logistics firm in Manchester, England, for exactly five years and eight months now. I started my job back in March 2019, and I have always been quite proud of my consistent attendance record. However, last month, the company was bought out by a much larger international corporation. My manager sat us down in the staff canteen on the 15th of October and explained that while our daily tasks and pay cheques will remain exactly the same, our new contracts will be issued by this new parent company instead of the old one. I have already checked my new contract, and it doesn't explicitly mention my previous years of service, which has me feeling quite anxious. I am worried that because I technically have a new employer on paper, my time with the original firm might be wiped clean. If I were to be made redundant next year, would I be treated as if I only started last month, or does my full five-year history still count towards my statutory rights and redundancy pay? I need to know if my continuous service is protected during this takeover.

Detailed Analysis

Under UK law, when a business or part of a business is transferred from one owner to another, your employment rights are preserved. This means your time with the original logistics firm in Manchester is not wiped clean just because a new international corporation has taken over.

According to the Employment Rights Act 1996, if a trade or business is transferred from one person to another, "the period of employment of an employee in the trade or business or undertaking at the time of the transfer counts as a period of employment with the transferee"^[1]. This means the new company (the transferee) must treat your previous five years and eight months as if you had been working for them since March 2019. Furthermore, the law states that "the transfer does not break the continuity of the period of employment"^[1]. Continuity of employment refers to the unbroken period of time you have worked for an employer, which is vital for calculating things like redundancy pay or unfair dismissal protection.

Even though your new contract does not explicitly mention your previous years of service, the law provides this protection automatically during a transfer of a business^[1]. If you were made redundant next year, your redundancy pay would be calculated based on your full history starting from March 2019, not from last month.

While the law protects your continuity, the Secretary of State has the power to make specific regulations regarding how employment continuity is preserved in certain cases of re-engagement or reinstatement^[2]. However, for a standard business buyout like yours, the primary protection remains the automatic transfer of your service history.

Note that local or specific employment regulations may add further rules to your situation.

Statutory Citations

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