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Are ‘fire and rehire’ tactics ever legal?

Makbool Javaid, Partner - Simons Muirhead & Burton

Employer ‘fire and rehire’ tactics have been rife throughout the pandemic. According to research by the TUC, one in 10 workers have been told to reapply for their jobs on worse terms since the first lockdown in March 2020.

The controversial practice has faced considerable opposition from workers and unions alike, with Frances O’Grady, general secretary of the TUC, saying it has “no place in modern Britain and must be outlawed”. And Ben Willmott, head of public policy at the CIPD, says forcing a change to an employment contract by dismissing someone and rehiring on different terms should be “an absolute last resort”.

But these are difficult times for businesses. The economic disruption caused by the lockdown measures have meant many employers have had no choice but to try and renegotiate their employment contracts. So under what circumstances might ‘fire and rehire’ be necessary, and is there a way businesses can renegotiate contracts this way without damaging their reputation or relationships with their employees? People Management spoke to employment law experts to find out.

Firing and rehiring should be a last resort. This can be damaging for employee relations in the long term, particularly if the process is managed insensitively.

“Even if there is no legal imperative for an employer to keep an employee in their job, employers should consider good business practices and do all they can to retain jobs, particularly during a pandemic.”

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