although the normal rule under the Acquired Rights Directive 77/187 Art 3(2) (now Council Directive 2001/23/EC) is that any adverse change to terms of employment of staff when their employment is automatically transferred to a new employer by reason of the undertaking for which they work being transferred is forbidden if it is made for a reason connected with the transfer, this normal rule is not absolute. The ECJ held that, subject to two provisos, the rule does not apply where a private sector undertaking is taken over by a public sector employer and the remuneration of transferred staff is cut to comply with national rules affecting public sector employees. The provisos are that affected employees' length of service must be taken into account in calculating their remuneration and that the resulting calculation does not lead to a substantial reduction in their remuneration.

For relevant general notes see Transfer of business or undertaking/change in terms of employment after