Government takes action against ‘fire and rehire’ practices | Consensus HR – Herts, Beds
A new statutory Code of Practice concerning certain controversial dismissal tactics will, the Department for Business and Trade (DBT) argues, protect workers’ rights whilst respecting business flexibility.
Dismissal and re-engagement, also known as ‘fire and rehire’, refers to when an employer sacks an employee and then offers them a new contract on new, often less favourable, terms.
Business Minister Kevin Hollinrake said: “Our new Code will crack down on employers mistreating employees and sets out how they should behave when changing an employee’s contract.”
It will, he went on, make clear how employers must behave in this area and help to preserve security and opportunity for those in work.
A consultation on a draft statutory Code that sets out employers’ responsibilities when seeking to change employment terms and conditions ran from 24 January to 18 April 2023.
The Government has now published its response to the 50 replies it received to that consultation. This can be found at https://www.gov.uk/government/consultations/draft-code-of-practice-on-dismissal-and-re-engagement together with an updated draft statutory Code on dismissal and re-engagement.
This has been laid in Parliament for approval by both Houses and, subject to that approval, it will be brought into effect later in the summer.
Employment tribunals will have the power to apply an uplift of up to 25% of an employee’s compensation if an employer unreasonably fails to comply with the Code.
Head of Public Policy at the Chartered Institute of Personnel and Development (CIPD), Ben Willmott, said: “The Code promotes good practice, making clear employers should always seek to agree any changes to terms and conditions with employees and that ‘fire and rehire’ should only be used as an absolute last resort. It highlights the importance of early and meaningful consultation with employees to maximise the chances of finding alternative solutions which can lead to agreement over proposed changes.”
HRInform – 20-02-24
Our HR Comments: – Government takes action against ‘fire and rehire’ practices | Consensus HR – Herts, Beds
Matthew Chilcott, FCIPD, ACEL, Owner of Consensus HR comments: “The updated draft of the Code for dismissal and re-engagement is an interesting read following the feedback received with the power to award a 25% uplift should an employer not follow the Code. The link provided within this article links to the draft code and the history behind ‘fire and rehire’ and I do not find anything new and should be what any reasonable employer would be following resulting in the correct and legal outcome for the employee(s) involved. Good constructive consultation is key as with all HR and management in general, to ensure a suitable outcome for the member(s) of the team, management and business in general. At Consensus HR, we work with our clients to ensure that any amendments proposed are managed professionally and to best practice.”
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