Usdaw brought the case on behalf of 42 workers employed by the supermarket giant in its Daventry and Lichfield distribution centres. The group faced having their wages cut as part of a change to their terms and conditions of employment by Tesco.
Today’s High Court ruling will prevent the supermarket’s ‘fire and rehire’ practice in this case where it had sought to lay people off and re-employ them on new contracts, with less favourable terms and conditions, in England.
The court noted that the 42 workers had been guaranteed an entitlement to a specific payment labelled ‘retained pay’ to keep them within the business, which Tesco intended to remove by firing and then rehiring them. The judge held that there was an implied term in the workers’ contracts that the right to terminate employment could not be exercised if the aim was to remove a right to ‘retained pay’.
Neil Todd, a trade union specialist at Thompsons Solicitors, said:
“This is a huge win for the workers and for Usdaw. The practice of firing and re-hiring staff on less favourable terms and conditions has been in widespread use over the last 18 months as employers try to erode rights that have been hard fought for and are there to protect some of the lowest paid in society.
“Tesco had made unequivocal commitments to its workers who had come into work throughout the lockdown, when it needed them most. The court agreed that, in those circumstances, it wasn’t then open to them to deploy fire and rehire tactics when it suited them.
“We are proud to have represented a trade union in taking on corporate giants who use fire and rehire tactics against the staff who had served them so loyally.”
This isn’t the first fire and rehire crisis that has embroiled Tesco. Its workers in Scotland have already secured an injunction, pending a full trial, on the same proposal.
Joanne McGuinness - Usdaw National Officer added:
“Companies are more frequently resorting to using fire and rehire tactics when they want to reduce employees’ terms and conditions of employment. Rather than reaching an agreement with the employees or their union, they simply threaten the employees with termination of their contracts, leaving them with an impossible choice.
“In this case, in around 2007 Tesco was beginning a vital distribution expansion programme and therefore to ensure that valued members of staff agreed to transfer location to new distribution sites, Tesco made assurances that those staff would retain the difference in their pay between their existing package and the new terms and conditions they would move to at those new sites.
“Importantly they assured Usdaw that this would not be removed at a future date. Despite this, some 14 years later Tesco reneged on its promises and sought to buy out this retained pay and threatened its employees with dismissal if they did not sign up to a new contract without the retained pay element. Tesco refused to negotiate with Usdaw who were left with no option but to seek a legal solution so as to protect its members’ pay.”
Notes to editors
Usdaw (Union of Shop, Distributive and Allied Workers)
is the UK's fifth biggest trade union with over 360,000 members. Most Usdaw members work in the retail sector, but the union also has many members in transport, distribution, food manufacturing, chemical industry and other trades.
For 100 years, leading social justice law firm, Thompsons Solicitors, has been using the law to fight for the rights of the injured and mistreated. Since 1921, it has worked alongside the trade union movement to implement key legal reforms and secure compensation for ordinary people, who might otherwise have been disadvantaged or marginalised. Thompsons ran:
- the first equal pay for equal value claim in the UK (1988) and later in Europe (1993)
- the case against UK construction companies for blacklisting union members in 2016
- the first case in the Supreme Court relating to trade union bargaining rights, establishing that employers cannot bypass or undermine union bargaining procedures in 2021
Today, the firm employs 800 staff who work at 23 offices right across the UK. Key areas of legal specialism include: trade union law, personal injury, serious injury, asbestos diseases, medical negligence, accidents at work and industrial diseases. As a point of principle, the firm has never worked for employers or insurers. Visit www.thompsons.law
or follow Thompsons on Twitter @ThompsonsLaw
For Usdaw press releases visit: http://www.usdaw.org.uk/news
and you can follow us on Twitter @UsdawUnion