The Government has introduced a new Employment (Amendment) Act 2025, confirming that key worker protections will apply during the transfer of services between companies, commonly known as TUPE (Transfer of Undertakings Protection of Employment) in the UK.

Why now?

The Government is likely proposing these changes now to align our local employment law with those already established in the UK and EU. Introducing a TUPE-style framework provides greater legal clarity and protection for workers during business transfers or outsourcing, something Gibraltar has lacked until now. Could this be another sign of regulatory groundwork ahead of a potential UK/EU Treaty?

What’s changed?

The new law amends Part VIB of the Employment Act to ensure that when a business or service is transferred to a new provider, employees are protected and their terms and conditions are preserved.

Specifically, it clarifies that the law applies in two main situations:

• A transfer of an undertaking, business or part of a business to another party in Gibraltar, where an economic entity retains its identity

• A service provision change, including when services are outsourced, insourced or re-tendered to another contractor

Key criteria for protection

According to the newly inserted section 78B(1A), for these protections to apply:

• There must be an organised grouping of employees situated in Gibraltar whose main purpose is carrying out the service

• The new arrangement must not be linked to a one-off event or short-term task

• The service must not be primarily about supplying goods for the client’s use

Why this matters

These amendments bring legal clarity to what happens when public or private sector contracts change hands. The new legislation ensures workers don’t lose their jobs or see worse conditions just because the company delivering the service has changed. Employers involved in contracting or outsourcing should take note of this updated legal framework and consider how it affects staffing, procurement, and bid submissions.

What employers should do

If you employ people, we suggest you audit your current employee structures to identify any groups that could be affected by the new rules. Ensuring full compliance when bidding for or handing over service contracts is essential, as employee rights must be protected during such transitions.

What do you think of this move, will it impact your business? Join the conversation on Glue Up’s Community pages.