Fire and rehire scenarios have been a scourge on employment law rights for the longest time. The Labour Government promised that it would seek to address this practice which can be oppressive for employees and over-used by employers wishing to impose unfavourable new contract terms on employees.
An employer cannot unilaterally change a contract of employment without the employee’s consent except where the change favours the employee: a classic example being awarding a pay rise or bonus which no employee is going to refuse. When matters become more unpleasant is where employers want to restructure and change a fundamental aspect of a contract and they require the consent to this change from the employee. A common example is a change/reduction in pension rights, the cause of many a public sector strike.
Even if a contract states that an employer reserves the right to change the contract this is not legally enforceable. If your employer is imposing a change on you take legal advice immediately.
The Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment of Schedule A2) Order 2024 (SI 2024/1272) (the Order) came into force on 20 January 2025.
The effect of the Order is that, if a successful claim is brought under section 189 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA 1992) for a protective award for failure to inform and consult on collective redundancies in a fire and re-hire situation, an employment tribunal can increase or reduce the award by up to 25% if a party has unreasonably failed to comply with the statutory Code of Practice on Dismissal and Re-engagement (the Code) or another applicable code of practice.
Although section 207A(7) of TULRCA 1992 gave the government the power to include such transitional provisions in the Order as it saw fit, none were in fact included. This suggests that tribunals could apply an uplift or reduction in any pending claims to which the Code applies, not just new claims brought since 20 January 2025.
The Code does not apply where the prospect of fire and re-hire was raised with employees or their representatives before 18 July 2024.
The Code was introduced under the previous Conservative government and came into force on 18 July 2024. The Labour government has proposed further measures to protect employees against fire and re-hire in the Employment Rights Bill.
