Schedule 2: Transfer schemes
197.This Schedule contains further provisions governing Transfer Schemes made under Sections 1 and 12. Provision is for powers to be given to the Secretary of State and the Scottish Ministers to transfer property, rights and liabilities for two different purposes:
Only the Secretary of State has power to make Transfer Schemes for the first of these purposes.
198.Paragraphs 1 and 2 set out how a Transfer Scheme may specify or identify property, rights and liabilities to be transferred. They also provide when the Scheme may come into force and define what may be transferred under a Scheme. A Transfer Scheme may include the transfer of property, rights and liabilities which could not be transferred by other arrangements (such as by contract). It may also provide that rights and interests which might otherwise be created, terminated or changed as a consequence of Transfer Scheme or anything relating to it shall only be enforceable to the extent that the Scheme provides that it is enforceable. Because this latter type of provision may affect the rights of third parties, there is provision in Paragraph 10 which sets out circumstances in which third parties may be paid compensation in relation to this.
199.Paragraphs 3 and 4 allow the maker of the Transfer Scheme to modify the property, rights and liabilities to which it relates and to place obligations on transferees and transferors in connection with the Transfer Scheme.
200.Paragraph 5 provides that Transfer Schemes made under this Act shall have the effect of vesting property, rights and liabilities in the transferee without the need for any further formalities. This would mean, for example, that legal title in any registered freehold land which is transferred by a Scheme is vested in the transferee without the need for there to be a transfer document executed by the transferor, as would ordinarily be required in relation to a sale of land.
201.Paragraph 6 contains provisions which enable persons making Transfer Schemes to transfer the ability to progress and operate a railway project from one person to another. The provision permits both the transfer of the relevant property rights and the transfer of any statutory powers or duties the transferor may have in relation to that property. Railway projects routinely require statutory rights and powers, and these are usually provided in Orders made under the Transport and Works Act 1992.
202.Paragraph 8 allows the transferor and transferee to modify a transfer scheme by agreement after it has come into force. Where the agreement would relate to a contract of employment or adversely affect the interests of a third party, the agreement will only be valid if the relevant employee or third party is party to it.
203.Paragraph 9 contains provision for continuity of employment rights for employees of the transferor who become, by virtue of a Transfer Scheme, employees of the transferee. Paragraph 9 also provides safeguards in relation to the pensions' entitlements of employees transferred under a transfer scheme. Its effect is to provide that any of those employees who are currently entitled (by virtue of paragraph 8 of Schedule 11 to the 1993 Act) to continue to participate in the Railways Pension Scheme will not lose that entitlement by virtue of the transferee employer not being engaged in the "railway industry" (as defined in Schedule 11 of that Act) for those purposes. Transferred employees will also be deemed to have continuity of employment for those purposes, as well as more generally, and, where applicable, for the purposes of continuing to be a "protected person" under that Schedule and of continuing in consequence to benefit from the safeguards applying to the pension provision required for such persons.
204.Paragraph 9 also provides that where a person's employment is transferred by a transfer scheme to a transferee employer, the transfer itself will not be regarded as giving rise to a dismissal for the purposes of Part 11 of the Employment Rights Act 1996. Part 11 of the Employment Rights Act 1996 makes provision in relation to redundancy payments.
205.Paragraph 10 provides the circumstances in which compensation may be payable to third parties as a result of provisions in the Transfer Scheme. This Paragraph only applies to Transfer Schemes made under section 1, not to Schemes made under section 12.
206.Paragraph 11 provides a power for the person making a Transfer Scheme to require the transferor and transferee to provide him with the information which he needs in order to be able to make the Scheme. The transferor and transferee may be subject to fines if they do not comply with a request for information.