HR body CIPD conducted a poll of 2,000 employers who changed their employees’ contracts during the coronavirus crisis – finding that 22 per cent of organisations had altered terms and conditions.
The research found that of the firms who changed staff contracts between March 2020 and July 2021, one in ten used ‘fire and rehire' tactics, with the most common changes cited as location of work – 49 per cent and pay levels – 44 per cent. Changes to redundancy pay and conditions were made by 22 per cent of employers.
Of the firms that made changes, 86 per cent did so through negotiation, consultation and voluntary agreement. However, 14 per cent dismissed staff and rehired them on new terms.
Not all changes were negative – of the employers polled by the CIPD, 50 per cent of organisations included an improved pay offer in the contract compared to 38 per cent who reduced pay – and whilst 44 per cent reduced working hours, 24 per cent increased them.
In May, unions and MPs appealed for ‘fire and rehire’ practices to be outlawed. The union Unite ran a poll with the result showing that 70 per cent of the public wanted it to be made illegal. Industrial action was threatened by angry workers.
Ben Willmott - Head of public policy at the CIPD – stated that, given the upheaval to working locations and practices thrown up by the pandemic, it was not surprising that contractual changes had been made. He went on to say that whilst ‘fire and rehire’ was still not a widespread tactic, more progress could still be made to avoid the practice, which creates a high risk of legal claims, damage to reputation and employee relations.
He added:
“A large majority of changes to workers’ contractual terms and conditions were achieved through consultation and agreement. However, a minority of organisations did resort to using ‘fire and rehire’ practices. While our research shows this is not a widespread tactic, more progress can still be made in avoiding this practice which creates a high risk of legal claims, reputational damage and an adverse effect on employee relations. ‘Fire and rehire’ should only be undertaken after extensive consultation and all other alternatives have been considered.”
The CIPD has issued new guidance to support employers in making changes to terms and conditions. The have recommended that organisations use consultation and voluntary agreement rather than imposing terms and reiterates their view that ‘fire and rehire practices’ should only ever be considered as an absolute last resort - if changes to employment contracts are critical and voluntary agreement is not possible.
