Firing & Rehiring: is it legal?


8 June 2021

By Josh Fresle

The Covid-19 pandemic has resulted in a number of significant implications for businesses and employees alike. Consequently, a vast number of employers have changed the terms and conditions that their employees are employed under. Naturally, not all employees will be happy with these changes and some may refuse to agree to the new terms. When this situation arises, many employers will initiate what is known as "fire and rehire". This is when an employer provides lawful notice to their employee to end the employment contract. The employer then offers a new contract under their new terms and conditions. So long as the employer follows the correct and fair procedure and has a legitimate business reason for terminating the employee and rehiring them, the dismissal will often found to be fair.

A recent dispute between British Gas and its boiler engineers over changes to their terms and conditions of employment has brought the fire and rehire issue into the headlines. Following a 9 month dispute, around 500 employees refused to accept new changes to their employment contracts which meant they would have to work additional hours for no additional pay, and were all dismissed as a result. We are yet to discover whether this will lead to any claims for unfair dismissal against British Gas and will likely find out in the near future.

The fire and rehire issue has also been recognised by the government who have asked ACAS to investigate. The report has not yet been published though MPs have highlighted the need for caution when intervening in these types of commercial contract matters.

This is not legal advice; it is intended to provide information of general interest about current legal issues.