Design groups are being warned against employing account teams dedicated to one client, to ensure they avoid the risks inherent in employment legislation that comes into force on 6 April.
The legislation – Transfer of Undertakings (Protection of Employment) Regulations 2006 – is designed to protect employees when contracts change hands. Under its terms, design groups that win new business could be forced to hire whole account teams from the former incumbent or pay their redundancy costs. Consultancies that lose an account could find themselves giving up some of their best staff.
According to specialist media law firm Olswang head of employment Catherine Taylor, the legislation only applies to dedicated teams of account handlers. ‘If you have an organised group of people dedicated to an account, the legislation could apply. It’s had little impact in the past, because it’s rare for [design consultancies] to have an absolutely dedicated team,’ she explains.