TUPE cost estimator free interactive calculator for cleaning, security, grounds, waste and catering contracts
Most SME contractors fear TUPE because they can't put a number on it. This estimator does. Plug in the staff list disclosed in the SQ pack and get a Year 1 indicative cost in under a minute, with a risk badge that tells you whether the contract value can carry it.
Inheriting workforce
The staff you'll absorb at contract handover under TUPE.
Statutory and contractual costs
Pension auto-enrolment, holiday cover, sick pay, employer NI.
Employer NI applies above the secondary threshold (£9,100 per worker per year, fixed). 13.8% is the 2025-26 rate.
Mobilisation costs
One-off costs to absorb the inherited workforce in Year 1.
Contract value (for risk ratio)
Annual contract value lets the estimator flag risk if TUPE eats too much.
Year 1 TUPE cost
Indicative total
£232,740
Risk
Manageable
% of contract
47%
TUPE costs sit inside what a sensible margin can absorb.
Annual gross wages £15,600 per worker | £187,200 |
Holiday cover | £20,160 |
Sick cover | £3,600 |
Pension contributions | £5,616 |
Employer NI | £10,764 |
Training | £2,400 |
Uniform, ID, mobilisation | £3,000 |
| Total Year 1 | £232,740 |
Translate this into a bid price that protects margin and covers TUPE risk.
Run the bid / no-bid matrixWhere the cost actually goes
TUPE in four buckets.
Most SMEs can quote wages off the top of their head. The other three buckets are where the surprises live.
60-70% of total
Wages
Hourly rate × hours × 52 × headcount. The biggest line by far. Buyers often disclose wage data in the SQ pack. Use real numbers, not assumptions.
20-25%
On-costs
Pension auto-enrolment (3% employer minimum), employer NI (13.8% above £9,100 per worker), holiday cover, sick cover. These add up faster than most SMEs assume.
5-15%
Hidden risks
Occupational sick schemes, contractual perks, holiday accruals carried over, pension transition. Surface in due diligence, not in the SQ. Budget contingency.
One-off
Mobilisation
Uniform, ID, training, induction, equipment hand-over. Per-head cost ranges £150 to £500 depending on sector. Often under-budgeted by half.
Where TUPE bites SMEs hardest
Three traps to flag at SQ stage.
The math runs cleanly with disclosed inputs. The risk lives in the assumptions the disclosed inputs hide.
- Long-service legacy. Staff with 15+ years carry redundancy liability if the contract gets cut. A redundancy provision of £20k+ per long-serving worker is typical.
- Defined-benefit pensions. If the outgoing employer ran a DB scheme, pension transition can be ruinous. Check the pension type at SQ stage and refuse to bid if DB is in scope without buyer indemnity.
- Contractual sick schemes. Some legacy contracts pay full salary for 26 weeks of sickness rather than SSP after week 1. That liability transfers under TUPE. Ask the buyer for a sample employment contract.
Questions, answered.
What is TUPE?
TUPE stands for the Transfer of Undertakings (Protection of Employment) Regulations 2006, as amended. When a service contract changes hands, the staff delivering that service typically transfer to the incoming provider on their existing terms. The new provider inherits salary, holiday entitlement, pension contributions, length of service, and any contractual quirks the previous employer baked in.
What does the estimator include?
Annual gross wages, holiday cover, sick cover, pension contributions, employer's National Insurance, and one-off mobilisation costs (training, uniform, ID badging). It returns a Year 1 indicative figure plus a risk badge based on what percentage of the contract value the TUPE bill represents.
What does it not include?
Occupational sick schemes (above SSP), redundancy provisions, defined-benefit pension transition risk, the cost of due diligence on the outgoing provider's records, holiday accruals carried over from the previous contract, or contractual perks like enhanced shift premiums. Treat the result as a budget anchor, not a final figure.
How accurate is the Year 1 cost?
It's an indicative figure. The math is sound for the inputs provided, but TUPE always surfaces hidden costs in due diligence: staff with 20+ years of service, undisclosed pension obligations, contractual sick-pay schemes that exceed SSP. Build a contingency buffer of 10 to 15% on top of the estimator's number for any contract over £250k.
What's a healthy TUPE-to-contract ratio?
Below 50% of annual contract value: manageable, leaves room for management overhead, equipment, profit. 50 to 70%: tight, the bid will work only with disciplined cost control. Above 70%: high risk, the contract is essentially the workforce. One sick spike or wage increase eats your margin.
Why does mobilisation cost matter?
TUPE transfers staff but they still need new uniforms, ID badges, training on your systems, and induction onto your H&S processes. Most contractors under-budget mobilisation by half. A typical Year 1 mobilisation cost is £200 to £500 per inherited head depending on sector and site complexity.
Is this tool legal advice?
No. The estimator is a budgeting aid, not legal or HR advice. Every TUPE transfer should go through formal due diligence with your HR provider or employment lawyer. The risk of getting TUPE wrong (failure to consult, indirect discrimination, ambiguous information) sits with the incoming provider, not the buyer.
Price the bid against real UK tenders.
CleanTender feeds your TUPE estimate into the bid / no-bid scorer on every live UK soft FM contract.
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