By Cathy Cross, Treasurer, Campaign For Trade Union Freedom
Two years on from the mass-sacking of 786 directly employed UK seafarers by P&O ferries on 17th March 2022 the Government has failed to introduce the reforms required to to protect or enhance worker’s rights.
The response to the scandalous behaviour of P&O included a mobilisation by the trade union and broader labour movement and at the time, the government, under pressure, committed to introducing a “code” to give legal force to ensure employers should behave “fairly and reasonably when seeking to change employee’s terms and conditions”. To this end the government published a draft code of dismissal and re-engagement (January 2023) and intends to publish the final version of that code imminently.
The contributions to a debate in the House of Lords at the second reading of the Employment and Trade Union Rights (Dismissal and Re-engagement ) Bill ( the bill) on March 1st 2024 highlight how widespread “fire and re-hire” is, not just in the private sector but in the public sector as well and exposes the shortcomings and inadequacy of the proposed government code, which will not even be legally binding.
The bill, a private member’s bill, introduced by the labour peer, Lord Tony Woodley, Employment and Trade Union Rights (Dismissal and Re-engagement) Bill [HL] (parliament.uk) and written by Lord John Hendy (KC) aims to tighten the rules around the use of fire and rehire practices by employers, including by providing affected workers with additional protections. It consists of four clauses and its main measures would be achieved by amending the Trade Union and Labour Relations (Consolidation) Act 1992 and the Employment Rights Act 1996.
For anyone thinking the title of the bill sounds familiar, that is because an identical bill had been previously introduced in the 2022-23 session of parliament, by Lord Woodley and a similar bill had been introduced in the House of Commons in the 2021-22 session by Barry Gardiner MP. Employment and Trade Union Rights (Dismissal and Re-engagement) Bill – Parliamentary Bills – UK Parliament
In his opening comments on March 1st , Lord Tony Woodley stated:
“The Government accept that fire and rehire is a problem but say that legislation is not needed because they have a new code of practice. While I welcome the Government’s efforts, the code as written is completely toothless. There is no requirement for employers to open the books to prove that the pay cuts or other changes are absolutely necessary to stop a firm going bust.”
He went on to say
“The code creates no new legal obligations on employers at all. In fact, paragraph 12 is clear that breaching it does not make a company liable to any proceedings. The worst that can happen is that they might—I emphasise “might”—have to pay an extra 25% on any compensation awarded by an employment tribunal, no matter how small. With respect, this is woefully inadequate punishment for such abusive behaviour.
Of course, we all know that employment tribunals are notoriously hard for workers to win. As I have said many times, what is needed to end these fire and rehire abuses is legislation. I offer my Employment and Trade Union Rights (Dismissal and Re-engagement) Bill to your Lordships for consideration.
I am grateful to my noble friend Lord Hendy for drafting the Bill alongside Professor Keith Ewing. I am grateful to Barry Gardiner for bringing the Bill to the other place and raising public awareness. I am very grateful to the TUC and its numerous member unions who support the Bill, and particularly to my union, Unite. I am very grateful to my party, the Labour Party, for backing the Bill enthusiastically, and for committing to end fire and rehire abuses within the first 100 days of government.”
Following that introduction Lord John Hendy (KC) outlined that :
“Fire and rehire is widespread, as my noble friends Lady O’Grady and Lord Woodley and the noble Lord, Lord Balfe, have demonstrated. It places workers in an awful dilemma: they must accept a cut to their standard of living or face unemployment. The anguish of that horrible choice needs little elaboration at a time when real wages have been stagnant since 2007.
and set out how fire and rehire is
“used predominantly against the lower paid, and disproportionally represented among the lower paid are, naturally, women, ethnic minorities and those with a disability”.
Baroness Frances O’Grady then highlighted the inadequacy of the government’s proposed code of practice and urged the government to support the bill
“…..let us recognise that fire and rehire is often just a fancy name for casualisation: long-standing hotel staff on full-time contracts being rehired on short-hours arrangements; university lecturers facing similar, not least at SOAS, where worse conditions for staff mean a worse education service for students; and seafaring crews on collectively agreed terms and conditions being replaced by agency staff paid a pittance. As TUC analysis shows, it is no accident that black and ethnic-minority workers are twice as likely to find themselves on the sharp end of fire and rehire.
Paying lip service in the form of a code is not good enough. The Bill offers the Government a second chance to get this right, to make good on their P&O promises and to stop the slide towards insecure employment in Britain. I urge the Government to support the Bill so that the decent employer is not undercut by the bad, and so that everyone at work gets the respect and dignity that they have earned”.
Lord Prem Sikka urged fellow peers to back the bill stating:
“We cannot build a sustainable economy by increasing worker insecurity. That has not been done anywhere, yet it is what the Government are trying to do here. Workers’ economic security is undermined wherever employers wield the capacity to demand, deny or discontinue work completely at will and with impunity. The Work Foundation estimates that in 2023, around 6.8 million workers—around 21% of them—were in severely insecure work, with wholesale and retail, agriculture, professional and scientific, and hospitality workers particularly badly affected. The Chartered Institute of Personnel and Development has reported that, since the pandemic, nearly one in 10 workers have been told to reapply for their jobs on worse terms and conditions or face the sack.”
Despite powerful speeches and cross-party support in the House of Lords, the government minister responding to the Lords comments did not accept the arguments made and this of course was not unexpected.
The bill will now go to committee stage in the House of Lords.
A House of Lords library briefing can be found here together with the Hansard transcript for the second reading of the bill found here Employment and Trade Union Rights (Dismissal and Re-en – Hansard – UK Parliament which sets out key arguments in favour of the bill.