HMRC have announced changes in how they enforce National Minimum Wage (NMW) penalties against employers involved in TUPE transfers. See the HMRC update here (at page 4).
From July 2018, any liability for historic NMW underpayment or any penalties relating to the underpayment will be enforced against the new employer (i.e. the transferee). This is irrespective of whether the new employer was responsible for the underpayment or not.
Previously any such back pay or penalties were sought from the transferor for arrears occurring prior to the transfer. This is now not the case.
Employers, in particular transferees in TUPE transfers, should ensure that the correct Employer Liability Information has been provided ahead of a TUPE transfer. Also, that as much due diligence as possible is done before the transfer date. Future indemnities in commercial contracts should also be reworded to take into account the increased risk to businesses from this change of approach from HMRC.