Employment Rights Bill | Fire and Rehire

Employment law changes will make it automatically unfair to dismiss staff for refusing contract changes or rehiring on worse terms.

The Government is proposing to make it automatically unfair (this becomes a day 1 right for employees) to dismiss employees where the reason for dismissal is either:

1. The employer sought to vary the employees contract of employment and the employee did not agree - OR -
2. The reason is to enable the employer to employ another person, or to re-engage the same employee under a varied contract of employment to carry out substantially the same duties as the employee carried out before dismissal.

A Statutory Code of Practice was introduced in July 2024 and is a guide for employers regarding what steps should be taken before termination. There is a very limited defence for the employer - when the reason for the variation was to eliminate, prevent or significantly reduce, or significantly mitigate the effect of, any financial difficulties which at the time of the dismissal were affecting, or were likely in the immediate future to affect, the employer’s ability to carry on the business as a going concern or otherwise to carry on the activities constituting the business, and in all the circumstances the employer could not reasonably have avoided the need to make the variation.