But they have welcomed news that the UK will push for changes in Europe and could still bring in national regulations.
The consultation paper on Transfer of Undertakings (Protection of Employment) Regulations and the European Acquired Rights Directive, issued this week by trade minister Ian McCartney, calls for views on improving the Directive while Britain holds the EU presidency over the next six months.
Unions, contractors and DSOs wanted specific UK regulations to clarify TUPE, following uncertainty since the European Court of Justice ruling in the Suzen case last year. The decision threw doubt over when TUPE applied and whether transferred staff could expect any protection.
But he praised the DTI for initiating discussions on requiring contractors to provide comparable pension schemes to transferred staff.
Public Contractors Association secretary Cliff Davis-Coleman said the paper was 'a very flimsy document' and appeared to be influenced by pressure from the Treasury to keep down spending.