February 2023 – Code to Prevent Fire and Rehire Practices

Courts and employment tribunals will be able to take the code into account when considering cases, including unfair dismissal, with power to apply a 25 per uplift for compensation awarded where employer found to have breached its provisions

Following the failure of P&O Ferries to follow best practice when it sacked 786 seafarers without due consultation last year, the government introduced a nine-point plan to tackle these fire and rehire tactics - when an employer fires an employee and offers them a new contract on new, often less-favourable terms.

However, the government decided that primary legislation was not needed in other sectors and instead decided to tackle the problem through a new statutory code.

The new code will make it explicitly clear to employers that they must not use threats of dismissal to pressurise employees into accepting new terms. It will require employers to have honest and open-minded discussions with their employees and representatives and require businesses to consult with employees in a fair and transparent way when proposing changes to their employment terms.

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