The UK’s Supreme Court has ruled against Tesco’s ‘fire and rehire’ practices.
- This landmark decision prevents Tesco from altering employment terms unilaterally.
- The ruling is viewed as a significant win for workers’ rights and the union Usdaw.
- Tesco’s attempt to modify pay terms at its Daventry and Litchfield centres was blocked.
- The judgment underscores the necessity for employers to honour existing contractual agreements.
In a crucial ruling, the UK’s Supreme Court has decided against Tesco’s attempt to employ ‘fire and rehire’ tactics, a strategy that involved terminating employees’ contracts only to offer them new terms that were less favourable. This decision echoes the judiciary’s stance on safeguarding workers’ rights and maintaining the integrity of established contractual agreements.
For several years, the dispute centred around Tesco’s intention to eliminate ‘retained pay’ for warehouse workers, a move challenged by the shopworkers’ union, Usdaw. The union argued that this pay constituted a core component of the employees’ compensation package, agreed upon due to their dedicated service.
The Supreme Court’s unanimous decision reinstates a previous injunction, preventing Tesco from altering these employment terms without negotiation. Lord Reed and other judges highlighted that it was inconceivable for the original contract terms to allow unilateral terminations at Tesco’s discretion. This ruling signifies a broader judicial recognition of fair contractual treatment in employment.
The legal battle initially saw an injunction obtained by Usdaw in 2022, halting Tesco’s plans. Although Tesco managed to overturn this via an appeal, the Supreme Court has now reversed that ruling, reinforcing union victories from 2021. The decision is heralded as a triumph for the labour movement, emphasising legal protections against abrupt contractual changes.
Tesco has acknowledged the verdict, expressing commitment to fairness among its distribution centre colleagues. A spokesperson noted that while the dispute involved a minor segment of their workforce, the company had historically offered supplements to retain certain employees, which were intended to be phased out.
Usdaw General Secretary Paddy Lillis expressed delight in the outcome, emphasising the critical nature of such benefits as a permanent part of workers’ pay. This resolution is seen as a successful defence against aggressive employment strategies, sending a clear message about the adequacy of legal remedies such as injunctions in employment disputes.
The Supreme Court’s ruling is a pivotal moment for employment rights, reinforcing the prohibition of unilateral contract alterations by employers.
