As a fixed-term contractor, you might someday face dismissal and re-engagement (commonly known as “fire and rehire”) if your employer seeks to change your terms and conditions of employment. This practice often arises when an employer wants to implement changes in working conditions but cannot reach an agreement with employees.
Why you might be dismissed and rehired:
Employers may consider this strategy when they need to adapt their business to financial, operational, or other pressures. For instance, they may want to reduce salaries, adjust working hours, or amend benefits. If employees resist these changes, the employer may terminate contracts and offer new terms under fresh contracts. The Code of Practice on Dismissal and Re-engagement aims to ensure that this approach is used as a last resort, after meaningful consultation with employees.
What should happen before dismissal:
- Consultation: Your employer is required to engage in good-faith consultations with you and other employees before dismissal. This consultation period should explore alternatives to dismissal, and you must be provided with sufficient information to understand the proposed changes and the reasons behind them.
- Transparency: Your employer should provide clear details about what changes are being proposed, why they are necessary, and what other options have been considered. The more informed you are, the better your chances of proposing alternative solutions or negotiating fair terms.
- Fair Process: The employer must not threaten dismissal prematurely or use it as a pressure tactic. The goal should be to reach a mutual agreement wherever possible.
Your rights:
As a contractor, you are protected under employment law if your contract is covered by UK labor regulations. The new code ensures that employers must follow specific procedures during this process:
- Meaningful Consultation: You have the right to be properly consulted and involved in the decision-making process. The employer must engage in meaningful dialogue and consider any counter-proposals you may put forward.
- Information Sharing: Your employer should provide detailed information about the proposed changes and their implications.
- Acas Involvement: You may seek advice from the Advisory, Conciliation and Arbitration Service (Acas) to help mediate any disputes or clarify your rights.
What to do if your rights are overlooked
If your employer fails to follow the code or dismisses you without proper consultation, you may have grounds to challenge this through an employment tribunal. In such cases, the tribunal can apply a 25% uplift to any compensation if the employer is found to have unreasonably failed to follow the code.
If you believe that your rights are being ignored or you have been dismissed and rehired unfairly, you should:
- Seek legal advice: Consult with a legal expert or your trade union (if applicable) to understand your position.
- Contact Acas: They provide free, impartial advice and can help with resolving disputes.
- Consider an Employment Tribunal: If the issue remains unresolved, you can take the matter to an employment tribunal to seek compensation or challenge the dismissal.
By being aware of your rights and following the proper steps, you can protect yourself in scenarios involving dismissal and re-engagement. For more detailed information, you can refer to the Code of Practice on Dismissal and Re-engagement published by the UK government.
Tech companies are known for fire and rehires
Several tech companies have been reported to undergo firing and rehiring cycles due to market pressures, restructuring, or strategic shifts. During downturns, they cut staff but often rehire when conditions improve or the focus shifts to new projects.
For example, a spree of tech layoffs in 2022 mostly affected business and recruiting teams across Facebook, Instagram, and WhatsApp. The next round of layoffs would then see more cuts in recruiting, plus sales and marketing, according to reports by The Washington Post and Wall Street Journal. Key examples:
- Meta: Laid off thousands in 2022-2023, later rehiring in AI and the metaverse.
- Microsoft: After layoffs in 2014 and 2023, it rehired for AI, cloud, and cybersecurity. But has recently announced it is making more layoffs in its gaming division.
- Google: Cut 12,000 jobs in 2023, now hiring in AI and cloud computing.
- Twitter (X): Massive 2022 layoffs followed by rehiring engineers for critical roles.
- Salesforce: After cutting 10% in 2023, it rehired in AI and enterprise software.
- Amazon: Layoffs in 2022-2023, rehiring in AWS and logistics.
- Tesla: Rehires after layoffs, especially for giga factory expansions.
- IBM: After layoffs, it rehired in cloud, AI, and quantum computing.
- Snap: Post-2022 cuts, rehired in AR and product development.
- Intel: Rehiring in AI and chip design after industry downturns.
