Govt blocks bill to stop fire and rehire

The government has today (22 October 2021) blocked an attempt to pass a law that would prevent employers from using fire and rehire tactics to bully workers into lower paid jobs.

Introducing the Employment and Trade Union Rights (Dismissal and Re-engagement) Bill to its Second Reading in the House of Commons, Labour’s Barry Gardiner said his bill would not ban fire and rehire due to the potential for “perverse consequences” such as mass redundancies when restructuring is essential within businesses.

Instead, it would require businesses to meaningfully consult with their workers and worker representatives when such restructuring is required in order to strike a mutually agreeable deal where new terms and conditions could enable a business to stay afloat through a crisis.

It was noted that nearly one in ten (9%) of workers responding to a Britain Thinks survey said they had been threatened with fire and rehire in the last nine months and that 70% of the companies using such tactics are not in fact at the precipice of collapse but still profit-making. Indeed, household names such as a Tesco, Sainsbury, Argos, British Airways and British Gas have all used fire and rehire tactics during the pandemic.

International comparisons, such as with Germany, were used to show how greater protections for workers also improved economic productivity, while fire and rehire was associated with a fall in worker morale and poorer economic outcomes as a result.

Among the workers Barry had spoken to while campaiging for his bill, he met ones who had been threatened with a £15,000 annual cut in pay, faced losing both their homes and their access to their children as a result, been pressured on their own doorsteps by employer representatives sent round to their houses with new contracts in hand, and a family who felt betrayed by an employer for which they had put in a over 100 cumulative years’ of service.

BAME workers are nearly twice as likely to be threatened with fire and rehire and when employers pull off this tactic, the cost of doing so often falls to the taxpayer through Universal Credit payments lower-paid workers are suddenly forced to rely on.

Victims of fire and rehire “are workers who have kept us all going through the pandemic … loyal workers who have served their companies for years,” Barry said, but “this is not just a human cost, it’s an economic cost to the whole country as well”.

During the debate, politicians from all sides of the house appeared to agree that fire and rehire tactics were morally wrong but Conservative MPs pushed back against the need for legislation, saying updated ACAS guidance to businesses should be enough to tackle the problem.

The government then voted down a “closure motion”, which would have allowed the House to vote for or against the bill, and proceeded to filibuster the Bill by talking until Parliament ran out of time. Indeed, Business Minister Paul Scully took 40 minutes to complete his speech.

It was also pointed out that a significant propotion of the government’s MPs left the chamber after voting down the Closure Motion, raising suspicion that they had been whipped to prevent the Bill going to the vote and were not intending to engage with the legislation in good faith.

Criticism was also levelled at the government for scheduling an unrelated statement on public health and discouraging obesity midway through the second reading, despite the fact Friday is typically reserved for the reading of Private Members’ Bills.

Conservative MP, Peter Bone, said: “It seems to me this is talking about something for next year. There are 17 bills to be debated today, why is it urgent to put this statement on today on Private Members’ time rather than Government?”

Barry Gardiner said the government’s behaviour today was “cowardly”.

“In politics, it’s rare to find something that absolutely everyone agrees on and yet all the way from Len McCluskey to the Prime Minister himself, everyone agrees fire and rehire is wrong. So why is the Government determined to block this Bill?,” he said.