Lord Woodley

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That the Bill be now read a second time.

Lord Woodley (Lab)

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My Lords, I am grateful for the opportunity to propose for your Lordships’ consideration what I believe are urgently needed changes in the law to protect UK workers from gross exploitation. I am referring to the shameful practice of dismissal and re-engagement, otherwise known as fire and rehire, where workers are threatened with the sack unless they agree to cuts to their pay, terms and conditions.

Exploitative employers have abused a legal loophole for many years by threatening to sack staff while protecting themselves against unfair dismissal claims, with so-called substantial reasons for the firing. This immoral practice took off in the pandemic, when major firms, such as British Airways, British Gas and many more took advantage of the crisis to boost profits off the backs of their own workers.

Fire and rehire continues post pandemic. At PHINIA in Gillingham, workers began industrial action in January over plans to remove paid lunch breaks, and the firm has now threatened to fire and rehire everyone to force through this pay cut. This does not affect just the private sector; Wiltshire Council is trying to fire and rehire care staff, social workers, traffic wardens and others to remove unsocial-hours payments. Border Force staff at Heathrow Airport are fighting against proposed pay cuts of up to 20% due to changing their shift patterns and allowances.

We ask ourselves how on earth this can be allowed to happen. Firms currently have free rein to cut workers’ pay, terms and conditions, as long as they tick a few boxes, such as claiming financial difficulties and holding a superficial consultation. There is no need to prove that the proposed cuts are necessary to save the business from collapse or for redundancy payments if staff do not agree to new contracts. They just lose their jobs. It is scandalous. There is also no need for company directors and executives to cut their pay and pension pots; that is just for the little people.

The Government accept that fire and rehire is a problem, but say that legislation is not needed because they have a new code of practice. While I welcome the Government’s efforts, the code as written is completely toothless. There is no requirement for employers to open the books to prove that the pay cuts or other changes are absolutely necessary to stop a firm going bust.

The code creates no new legal obligations on employers at all. In fact, paragraph 12 is clear that breaching it does not make a company liable to any proceedings. The worst that can happen is that they might—I emphasise “might”—have to pay an extra 25% on any compensation awarded by an employment tribunal, no matter how small. With respect, this is woefully inadequate punishment for such abusive behaviour.

Of course, we all know that employment tribunals are notoriously hard for workers to win. As I have said many times, what is needed to end these fire and rehire abuses is legislation. I offer my Employment and Trade Union Rights (Dismissal and Re-engagement) Bill to your Lordships for consideration.

I am grateful to my noble friend Lord Hendy for drafting the Bill alongside Professor Keith Ewing. I am grateful to Barry Gardiner for bringing the Bill to the other place and raising public awareness. I am very grateful to the TUC and its numerous member unions who support the Bill, and particularly to my union, Unite. I am very grateful to my party, the Labour Party, for backing the Bill enthusiastically, and for committing to end fire and rehire abuses within the first 100 days of government.

Before I explain what the Bill does, let me explain and make clear what it does not do. It does not ban fire and rehire completely and utterly in all circumstances. That is an important point, which I ask the Minister to take note of. I accept that, when a company is in financial crisis, this might sometimes be necessary, as a last resort, when the alternatives really are seeing the business going down. I think we can all agree that this would be a regrettable but acceptable use of fire and rehire. I am sure the Minister agrees, because this is exactly the scenario the Government always use when they say we must not ban fire and rehire—extreme circumstances, where the alternative is bankruptcy. Likewise, I am sure the Minister will also agree that fire and rehire should never be used simply as a tactic—a “bully-boy tactic”, in the words of a Minister in the other place.

That is exactly what my Bill seeks to address. Quite simply, it puts on a statutory footing the procedure that decent employers—and there are many of them—already follow. Central to this is the requirement for employers to show workers and the trade unions that such an extreme step really is a last resort; to show that, without this drastic action, everyone would lose their jobs because the business would go under. As my Bill puts it, they must show that

“there is a real threat to continued employment”

because of

“the economic situation affecting the employer”.

This is exactly what the new code of practice does not do—not at all. Respondents to last year’s consultation suggested that

“the Code should use a tighter definition of when dismissal could be used, for example when the employer has shown that it is required to ensure the survival of its business”.

Disappointingly, the Government do not agree with this tighter definition, so it is not part of the code.

My Bill would compel bosses to hand over any information

“without which the appropriate representatives would be … impeded in carrying on consultation with the employer”.

Unions could also involve the Central Arbitration Committee if bosses drag their feet or refuse to engage in meaningful consultation. This would be far more effective than the Government’s meek suggestion to employers, at paragraph 26 of the code, that they,

“should share as much information … as is reasonably possible”.

Remarkably, the code then suggests that bosses can avoid sharing even the basics by claiming imminent bankruptcy—how convenient. Paragraph 32 says that,

“if a business is suffering a financial crisis … the employer may not be able to provide as much information as a business in more settled times”.

Then, in paragraph 35, the code gives a get-out clause for any information that bosses believe to be “commercially sensitive or confidential”. How convenient, yet again. My Bill would allow information to be withheld only if sharing it would

“seriously harm the functioning of, or … be prejudicial to”

the operation of the business. I suggest that this is a fairer way of operating.

My Bill would also provide enhanced protection to any workers who refuse changes and find themselves fired as a result. Above all, it would help level, at least to some degree, the unequal playing field between bosses and workers. Right now, bad bosses are using fire and rehire as a tactic to boost their profits at the expense of workers. For these bosses, it is not about saving their business from bankruptcy; it is about using the current cost of living catastrophe as cover, basically to blackmail workers into worsening wages. It is simply not right to treat a loyal workforce—many with long service—in this way. That is why I am asking for support to take the Bill into Committee, where it can rightfully be fully scrutinised and, I am sure, vastly improved by the many fine minds we are fortunate enough to have in this place.

In finishing, I ask the Minister the following questions. Does he accept that my Bill does not ban fire and rehire in all circumstances but simply stops it being used as an abusive tactic by bad bosses to boost profits? Does he appreciate that fire and rehire could still be used as a last resort when a company is genuinely facing financial ruin, and that this line of argument should not be used as a reason to oppose my Bill? Does he believe that the code would have stopped British Airways, British Gas or, to take a live dispute, the Border Force at Heathrow Airport, where the Home Office is firing and rehiring loyal staff over rosters and allowances? Does he appreciate that the 25% uplift—the one and only sanction contained in the code—applies only if a worker wins at an industrial tribunal, which is difficult at the best of times? Does he understand that this lack of any serious consequences is why the code is widely seen as toothless? Will he explain why the Government did not agree with the consultation respondents who said that dismissal should be used only when needed to ensure the survival of a business? Does he agree with respondents who warned that the code was “too weak” and would actually “legitimise” fire and rehire? I thank noble Lords for their patience and consideration. I beg to move.

Lord Balfe (Con)

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My Lords, it is a pleasure to follow the noble Lord, Lord Woodley, in this debate. I trust that what I say is fully within the guidelines laid down by my noble friend Lord Cameron when, as the then Prime Minister, he appointed me here and said, “See what you can do to help the trade unions—just make sure it does not cost us any money”. I think the Bill helps the trade unions and I am not sure it costs the Treasury any money—so it is within those guidelines.

First, I should make some personal declarations. As the register will record, I am the honorary president of BALPA, the pilots union, and very proud to be. I have also spent most of my life as a member of AUEW, TASS and its successors, which now puts me in the same union as the noble Lord, Lord Woodley. When I began my trade union career at the age of 16, it was in the Civil Service Clerical Association, which is now the PCS. On this day, when it launches its ballot for industrial action, it gives me great pleasure to endorse what the PCS general secretary, Fran Heathcote, said: fire and rehire is nothing short of bullying and is a nasty ploy used by unscrupulous employers to drive down pay, terms and conditions. It is worth placing that on the record. It was with that union that I held my first union position, when I became the acting chairman at 17. Because the communists of the Labour Party could not agree who should be the vice-chairman, it ended up as me, and then the chairman very inconveniently fell ill. At the age of 17, my bedtime reading was Citrine. I will not move today that the previous question be put, but that was one of my favourites in the Citrine handbook.

Let me move on. This Bill effectively tightens the rules around fire and rehire, but it really is an absolutely disgraceful practice for workers such as those I just quoted in the PCS ballot, many of whom have had their terms and conditions for 20 or 30 years—this is not something they got in a recent industrial action. This is not the way you build good industrial relations. Now, the CIPD recently did a survey and could not work out how many employers had used fire and rehire. It decided in the end that it was about 3% who had done so by dismissing and rehiring workers. That sounds a very small number, does it not? But it is over 40,000 employers. That is a big number, so we need to remember that, while this is not the biggest problem in Britain, it is certainly a big problem, particularly if you happen to be one of the workers involved.

I have spent my entire life in bits of the trade union movement; 25 years of it was spent in the European Parliament. One of the differences between that Parliament and our Parliament is that with the people in that Parliament who sit on this side of the House—the Christian Democrats, which was where I was for at least some of the time I was there—there is a trade union organisation within the party, led by a German Christian Democrat trade unionist. We used to have regular meetings, and our job was to harmonise the relations between capital and labour—not to stir them up but to make them work better, in the interests of society and industry. That is best done by co-operating with each other.

The trouble I sense with the present Government, I am afraid, is that the default position seems to be disinterest bordering on hostility. That is not a sensible way forward in industrial relations. All the people who go to work every day—I often use this example in my union—do not come from privileged backgrounds. Most pilots have worked their way up; they have been to technical school, found places in universities, become graduates and then engaged in very expensive training to do this hugely skilled job. The reason BALPA’s strapline was “Every flight a safe flight” was because the pilot is responsible for possibly 300 passengers and £150 million-worth of equipment. There was not a single fatal passenger plane crash in the world last year, but that exists because of work between the two sides of industry—and that should be our standard.

The standard we should be working to—I am afraid I have a lot of unfortunate heroes in my life—is that put forward by the late Ted Heath. He genuinely believed —although he got it a bit wrong on occasions—that the two sides of industry had to work together. They do have to work together; that is how we get a prosperous economy.

Apart from my history lectures, one of the things I talk about from time to time is the Conservative Party and its tremendous ability to reinvent itself. It has been doing so ever since it stood up for James II in 1688; noble Lords will recall that that does not appear in the manifesto anymore. But the fact of the matter is that, if we are going to move forward, the new Conservative Party has got to take a leaf out of the Ted Heath book and the European progressive trade union book, and has to learn that the future prosperity of Britain rests on both sides of industry working together for the common good. Working people need a decent wage and the employers need a decent dividend, but what they should not be doing is preying at each other’s throats all the time. That is not the way to build a successful country and a successful economy. I am pleased to support the Bill.

Baroness O'Grady of Upper Holloway (Lab)

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My Lords, I declare my interest as former leader of the TUC. It is a pleasure to follow the noble Lord, Lord Balfe, and also to congratulate my noble friend and fellow trade unionist Lord Woodley on bringing forward this Bill.

In the wake of the P&O Ferries scandal, Grant Shapps, who was Secretary of State for Transport at the time, said on Sky News that the Government would

“send a clear message … that we will not allow this to happen again. That where new laws are needed, we will create them. Where legal loopholes are cynically exploited, we will close them. And where employment rights are too weak, we will strengthen them”.

The Government’s new code of practice, sadly, comes nowhere near meeting that promise. It does not close the legal loopholes that allowed P&O Ferries to evade the law and financial sanctions. It does not strengthen unfair dismissal rights to prevent an employer sacking their workforce, and either rehiring or replacing them on inferior conditions. A 25% uplift in compensation hardly adds up to a deterrent. Noble Lords will recall that the P&O boss brazenly admitted that employers can simply price-in the cost of one-off payments.

Emma Wayland of Keystone Law has said:

“The cynical might say that this can be treated as a tick-box exercise that will present no more than a minor inconvenience to an employer, for whom the threat of fire and rehire can still be used”.


That cynicism is justified and rooted in real experience. It is disappointing that Ministers have pushed through this code when it does not have the confidence of the very people who are on the front line fighting fire and rehire—namely, workers and trade unionists. Businesses use fire and rehire tactics for the simple reason that, in Britain today, sacking workers and rehiring or replacing them on worse paying conditions is far too cheap and easy. Those guilty of this practice over recent years are not just those running a few back-street sweatshops, or a few struggling employers who have fallen on hard times. The roll of shame includes big names in the mainstream, which have absolutely no excuse—the likes of Tesco, British Gas and British Airways.

In many cases, unions have fought back and won, but no working family in Britain should be put through the worry, hardship and humiliation of being treated as throwaway labour. Workers need stronger protection against unfair dismissal from day one in the job and tougher tests that require employers to consult with unions with enough time to explore reasonable economic alternatives. Instead of making it harder for workers to protect their pay and conditions, as with the Strikes (Minimum Service Levels) Act, the Government should recognise that, when faced with the threat of fire and rehire or replacement, workers must be able to respond quickly and exercise their democratic rights to withdraw their labour. Where an employer flouts the minimum standards set out in law, for example by not following the required steps for consultation before sacking workers, those workers must be afforded an immediate remedy, notably automatic reinstatement.

Finally, let us recognise that fire and rehire is often just a fancy name for casualisation: long-standing hotel staff on full-time contracts being rehired on short-hours arrangements; university lecturers facing similar, not least at SOAS, where worse conditions for staff mean a worse education service for students; and seafaring crews on collectively agreed terms and conditions being replaced by agency staff paid a pittance. As TUC analysis shows, it is no accident that black and ethnic-minority workers are twice as likely to find themselves on the sharp end of fire and rehire.

Paying lip service in the form of a code is not good enough. The Bill offers the Government a second chance to get this right, to make good on their P&O promises and to stop the slide towards insecure employment in Britain. I urge the Government to support the Bill so that the decent employer is not undercut by the bad, and so that everyone at work gets the respect and dignity that they have earned.

Lord Hendy (Lab)

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My Lords, it is a pleasure to follow my noble friend Lady O’Grady. I too compliment my noble friend Lord Woodley on securing the Bill. I declare my trade union interests as in the register.

Fire and rehire is widespread, as my noble friends Lady O’Grady and Lord Woodley and the noble Lord, Lord Balfe, have demonstrated. It places workers in an awful dilemma: they must accept a cut to their standard of living or face unemployment. The anguish of that horrible choice needs little elaboration at a time when real wages have been stagnant since 2007.

The Office for National Statistics reports that median regular pay in November 2023 was as low as £27,588 per annum, which means that half the working population —16 million workers—earn less. Indeed, a quarter of the UK’s workers earn less than £16,068 per annum. No wonder the Joseph Rowntree Foundation, in its report UK Poverty 2024, estimates that 14.4 million people were in poverty in 2021-22 and nearly 3.8 million people experienced destitution,

“an extraordinary 148% increase over just five years”.

That is significant, because TUC research shows that fire and rehire is used predominantly against the lower paid, and disproportionally represented among the lower paid are, naturally, women, ethnic minorities and those with a disability.

The use of the tactic is not just bad for the workers on whom it is inflicted; it is bad for the economy. According to the ONS, the UK’s economy grew by 0.1% last year and has declined since. Reducing the spending power of workers shrinks the economy still further. That is a powerful reason to address this obnoxious practice.

Currently the tactic is lawful so long as the employer gives the employees the minimum notice of dismissal—contractual or statutory, whichever is the longer. The risk of a successful unfair dismissal claim is minimal for the employer that can show an economic need to reduce labour costs—what the legislation calls “some other substantial reason” for the dismissal. Even if that defence fails, the employer can argue that the offer of reduced terms was reasonable in the circumstances, and that dismissal for rejecting it was not unfair. So in effect the potential 25% uplift on compensation under the proposed code of practice is useless, as my noble friend Lord Woodley said and as the P&O Ferries scandal to which my noble friend Lady O’Grady referred shows, in relation to statutory capped compensation.

Fire and rehire is currently lawful because the law allows both the employer and the employee to give notice to terminate the contract of employment. For that fundamental reason, it is impossible to ban the practice, yet the tactic is plainly unacceptable where it is deployed simply to exploit managerial power in circumstances where the business faces no existential threat.

Its use may at least be understandable, if still not acceptable, in the rare situation where a business faces a dire and sudden crisis. The Bill allows for that so, as my noble friend Lord Woodley has pointed out, it does not ban fire and rehire. Instead, it imposes modest procedural obligations on employers seeking to reduce labour costs in this way. It applies only to establishments with 50 or more employees. It applies only where there is shown to be a real threat to continued employment or to contractual changes likely to affect 15 or more employees. In those circumstances the Bill imposes two obligations on employers. The first is to consult with a view to reaching agreement to avoid dismissals or contractual changes. Those consultations will be, as elsewhere in the legislation, with representatives of recognised unions or elected representatives. The second obligation is to disclose the information necessary to have meaningful negotiations and as required for good industrial relations.

There is an exception for information whose disclosure would seriously harm the undertaking or be contrary to the interests of national security. Any disputes over disclosure can be referred to the industrial relations expertise of the Central Arbitration Committee. Likewise, a dispute over whether there is proper consultation or proper disclosure can be referred to the CAC, which can then either refer the complaint to ACAS for conciliation or determine the complaint itself and make an order. In the case of non-compliance with a CAC order, a worker’s representative can seek a court injunction to compel compliance or to render void any dismissals or contractual changes in breach of the order.

Alternatively, a worker offered re-engagement on different terms may obtain an employment tribunal declaration if the tribunal concludes that the employer breached the Bill’s requirements of consultation and disclosure. In that case, “just and equitable” compensation may be ordered in respect of losses attributable to the dismissal or contractual changes. An employment tribunal may also declare that any “less favourable” variation of a contract of employment is void if brought about by the threat of dismissal where the consultation and disclosure obligations have been breached.

Where an employee is dismissed for refusing a contractual variation, “some other substantial reason” will no longer serve as a justifiable defence; and the two-year qualifying period for unfair dismissal protection will not apply. Dismissal in breach of a CAC order or a collective agreement will render a dismissal automatically unfair. The remedy of reinstatement or re-engagement is strengthened by the Bill in these circumstances.

The Bill will also relieve trade unions of the procedural burdens in relation to industrial action in response to an employer’s proposal to vary terms and conditions under threat of dismissal. The Bill provides that the Secretary of State must be notified of situations giving rise to the obligation to consult, and it will be an offence on the part of the undertaking and of any responsible director or manager not to do so.

By these means, so long as the employer does its reasonable best to consult and disclose, it has nothing to fear from litigation and can achieve variation of terms and conditions, if necessary by compulsion. I commend my noble friend Lord Woodley’s Bill to the House.

Lord Prentis of Leeds (Lab)

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My Lords, what happened at P&O was a dreadful abuse of employment rights—an abuse that was rightly condemned but one that, regrettably, is not limited to a few ruthless employers such as P&O. Employers across our economy, public sector and private sector alike, are now routinely using fire and rehire to force through unilateral changes to employment contracts—British Gas being among the worst.

During the 2020 Covid-19 lockdown, while the nation applauded our essential workers, British Gas, unbelievably, threatened to fire and rehire its entire workforce of 20,000. In May 2020, all employees were told that they would have to sign new contracts—contracts far worse than the ones they had—or face redundancy. The new contracts increased hours with no extra pay, took away payments for weekend working and undermined the long-standing pay agreements within gas. Trade unions such as mine that stood up for the workforce were threatened with derecognition; for British Gas, the current legislation is an irritant to be ignored.

Many in this Chamber have expressed their concern at the dreadful salaries earned by our care workforce. The care service is on its knees, with hundreds of thousands of vacancies, yet who would believe that care workers could be the victims of fire and rehire? But that is what is happening to care workers employed by Shaw healthcare in Powys. Carers, already the lowest paid, are losing their contractual 30-minute paid break; their shifts are being extended with no extra pay; their contractual right to eating prepared food with residents is being snatched away; and their livelihood is gone if they do not sign new contracts.

Fire and rehire is now routinely used across our public services to undermine employment rights. Sandwell Leisure did not want to pay the nationally agreed 2.75% pay increase. So what did it do? It fired and rehired its entire workforce of 280. Bristol-based St Monica Trust, a care trust, in seeking to cut the pay of senior staff by 21% and all other staff by 10%, threatened to sack care workers if they did not accept the pay cut. For some, the pay cut was over £3,000. Clarion Housing, the UK’s largest landlord, is using the threat of fire and rehire to force through worse pension arrangements for staff transferred from local government. Councils, too, from Tower Hamlets to Caerphilly and Wiltshire, are issuing new contracts with care workers and social workers told to accept worse conditions or be dismissed. The list goes on.

I make it clear that today is not about seeking to improve the pay and conditions of vulnerable workers; that is for another day. Today I want to impress on noble Lords that the devastating use of fire and rehire, dismissal and re-engagement, is not the tool of a few recalcitrant employers who can be ignored. When we talk about fire and rehire, we use terms such as “unscrupulous”, “abhorrent”, “cynical” or “a few bad apples”. The implication is that we are dealing with a few ruthless employers. Nothing could be further from the truth. Employers across the whole economy, including public service employers, are increasingly using fire and rehire and increasingly just paying lip service to current legislation.

The draft code of practice from our conciliation service will do nothing to constrain employers while the current legislation is so weak. That is why I ask this House to support my noble friend Lord Woodley’s Bill, rather than relying just on a draft code of practice—a code which is not fit for purpose and which we all know is toothless.

Lord Sikka (Lab)

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My Lords, I congratulate my noble friend Lord Woodley on this much-needed Bill, which will make the UK a better place for workers and businesses alike. As my noble friends Lord Woodley and Lord Hendy have explained, the Bill does not completely ban fire and rehire; it merely curbs the abuses and requires companies to properly consult employees on a statutory footing before any major restructuring that might lead to fire and rehire.

The Bill has reminded me of the words of a former US Republican President, who said:

“Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration”.


That President was Abraham Lincoln and his views are as relevant today as they were in 1861.

We all know that within our economic system there are antagonisms between labour and capital, but there is also a mutual dependence of the two. Workers’ rights are an indispensable part of wealth creation and building a sustainable economy. The Bill comes at a time when fire and rehire is being used as a bully-boy tactic to undermine workers’ pay and conditions across a number of industries.

A study by the Observer newspaper stated that 70% of employers using fire and rehire of staff on worse contracts maintained healthy profit margins and that, in most cases, also increased executive pay. British Gas used fire and rehire tactics to dismiss 500 engineers, but it has now reported a tenfold increase in profits in just one year. At Asda, some 7,000 workers are being impacted by fire and rehire as private equity owners seek to boost their returns.

We cannot build a sustainable economy by increasing worker insecurity. That has not been done anywhere, yet it is what the Government are trying to do here. Workers’ economic security is undermined wherever employers wield the capacity to demand, deny or discontinue work completely at will and with impunity. The Work Foundation estimates that in 2023, around 6.8 million workers—around 21% of them—were in severely insecure work, with wholesale and retail, agriculture, professional and scientific, and hospitality workers particularly badly affected. The Chartered Institute of Personnel and Development has reported that, since the pandemic, nearly one in 10 workers have been told to reapply for their jobs on worse terms and conditions or face the sack.

Women are 2.3 times more likely to be in insecure work than men. People from ethnic minorities, 18 to 25 year-olds and 1.45 million disabled workers are more likely to be in insecure work than any other sections of our population. Fire and rehire increases insecurity, anxiety and physical and mental health problems. Up to 300,000 people with mental health problems arising from their work situation lose their jobs each year. Around 51% of long-term sick leave is due to stress associated with work and insecurity. Since 2019, the total annual cost associated with poor mental health has increased by 25%. Employers are losing £56 billion a year because of the insecurities created for workers. Through this Bill, we can recover a part of that: it offers a road to economic recovery and improved labour supply.

A considerable body of scholarly research shows that improved worker rights and rewards provide a solid foundation for strong and stable economic growth by supporting demand and stabilising local currencies and financial systems. Better worker rights are essential for levelling up and result in higher productivity growth, thus leading to faster, stronger and sustainable economic growth. Improved worker rights result in a better distribution of income, both among workers and between workers and companies. In other words, better worker rights lead to a larger output that is more evenly distributed as well. As the benefits of faster growth are more evenly distributed, local demand tends to be stronger and more stable, preventing our town centres becoming economic deserts with swathes of empty shops.

In the face of fewer safeguards for workers, cuts in income reduce demand and Governments increasingly rely, as the current Government are doing, on a shrinking proportion of the population to reflate the economy. Households with unpredictable employment rights and loss of livelihoods resort to pawning things and borrowing money, which ultimately leads to lower spending, lower consumption, a higher risk of financial distress and higher risks to the financial system. We all know what happened before the 2008 banking crash; many people simply could not afford to pay their mortgages. That is one of the consequences.

In short, the Bill curbs the abuse of fire and rehire policies and facilitates economic benefits. I strongly urge all Members of this House to support it

Lord Browne of Ladyton (Lab)

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My Lords, it is a genuine pleasure to follow my noble friend Lord Sikka. It is not the first time his admirable forensic skills have made the House much better informed. He is, in my view, the antithesis to the widely held view that accountants are boring; he is certainly not.

I also commend my noble friend Lord Woodley and the ecosystem that supported him, not just for drafting this legislation but for the powerful, comprehensive and convincing speech he introduced the debate with. Mostly, I thank him for securing a Second Reading that helpfully coincides with the publication and laying of the Government’s feeble draft code of practice. It is remarkably easy, as all the speeches today have shown, to support this legislation. It is even easier to criticise and disaggregate the useless code the Government have come up with. I intend to spend a bit of my time trying to do that.

I have read almost every word that has been recorded in Hansard about the practice of firing and rehiring, and there seems to be a broad consensus on the unfairness of this practice. The debate is not a diagnostic one; we all know that this is a problem. It is rather a debate about solutions. While I recognise that recently the Government have fulfilled their commitment to publish and lay a draft statutory code of practice, I simply do not believe that it will have a material impact on removing the thumb on the scales that currently tilts the balance of power strongly in favour of unscrupulous employers. There is a catalogue of companies, and now, unfortunately, local councils, which have used this dreadful practice. There is no point in going through them; we all know that.

Given that the introduction of this code was first announced in response to P&O Ferries instituting mass redundancies in March 2022, I understand those who feel a little sceptical when the Government claim they wish to provide urgent redress. What can explain the slowness with which they have moved in this matter? The then BEIS Minister, Paul Scully, explained the Government’s commitment to introduce a statutory code of conduct in emotive and highly colourful language. He described the practice of firing and rehiring as “deceitful”, and “disgraceful”, labelled the actions of P&O “appalling” and “unscrupulous”, and vowed that the Government would “stand up for workers” against the “flagrant disregard” shown by companies that use sudden mass dismissal as a negotiating tactic. What has been the response to this clarion call—the Government’s own clarion call? We have seen the glacial emergence of a code of conduct over two years that will impinge on employers only at the point if a case were to reach a tribunal.

Given that, it may be worth examining the degree to which the tribunal system is currently calibrated to provide swift and effective redress for victims of this practice at all. Although backlogs have eased from pandemic levels, the average waiting time for claims to arrive at final hearing has increased, with some cases taking between 12 and 18 months from the date of issuing a claim. Furthermore, the Government have just begun a consultation on reintroducing fees for those who wish to bring a case before an employment tribunal. The last time this was tried, the Supreme Court ruled that unlawful in UNISON v Lord Chancellor 2017, and the judgment in that case was unambiguous. It cited the Leggatt report, which had identified the absence of fees as one of the three key elements that had made tribunals successful, and it concluded that levying fees was unlawful because

“it has the effect of preventing access to justice”.

The fees currently being considered by the Government are appreciably lower and accompanied by a fee remission scheme. They will certainly not encourage victims of fire rehire to have recourse to the tribunal system, and they will likely act as a further discouragement.

My final point on the tribunal system concerns the Government’s reasoning for introducing fees. The open consultation they have started explains that it is unfair for the taxpayer to bear the burden for the tribunal system while those who have recourse to it can access it without charge. Are they serious? There are some areas of policy in which this reasoning holds true, but this is not a question of repaying an investment or a discretionary activity; it is about access to justice for the vulnerable, which is a fundamental tenet of a civilised society.

Rather than reposing its faith in the forthcoming code of conduct, the Bill enshrines good practice into law and provides clearer lines of redress where appropriate standards are not met. Ultimately, the Bill is about justice and accountability. It protects workers from having their pay and conditions degraded under duress and ensures that, where companies or public sector employers, such as councils, choose to do this, they will do so only at the price of breaking the law.

Guidelines in the form of a non-binding code of conduct are simply inadequate. I do not believe that managers who threaten to fire several hundred employees unless they accept a pay cut do this without knowing that they are doing something wrong. They simply choose to do it anyway. The Bill prevents that, enshrining good practice into law. As my noble friend Lord Woodley told your Lordships’ House, the Bill would mandate appropriately deep consultation with unions. It would allow employees automatically to claim unfair dismissal in the absence of the best practice, and it would allow unions to do what they are designed to do and take rapid action where a reaction is needed to a fire and rehire threat.

Clause 2 speaks directly to the debate about equity between employers and their staff. First, it states that any change to an employment contract would be void if it was obtained under threat of dismissal. Secondly, it removes one of the arguments currently in the Employment Rights Act 1996 that an employer can make, in the case of fire and rehire, to show that such a dismissal was fair—namely, that there is “some other substantial reason”. Instead, the employer would be obliged to prove bad conduct, lack of competence, a threatened breach of the law or that the employee’s job had become obsolete. This specificity will ensure that fire and rehire will no longer be possible as a negotiating tactic.

Crucially, as my noble friend stressed and re-stressed, the Bill does not ban fire and rehire outright. There are cases where it is the only means of protecting jobs by preventing a company from collapsing altogether. The Bill is an attempt not to strangle enterprise but to ensure that those whose hard work has made an enterprise possible are protected from having their pay and conditions changed by managerial fear.

I began my remarks by saying that politicians of all stripes have acknowledged that the use of fire and rehire as a negotiation tactic is wrong. Granting that, the question that follows is about what solution we believe will be most effective: is it the passing of provisions that will explicitly prevent this practice, or placing our trust in adherence to a code of conduct that is not legally binding? My answer to that question is reflected in the support I offer the Bill and the support I will offer any similar measure that will come before your Lordships’ House.

Lord Davies of Brixton (Lab)

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My Lords, I should declare that I am a member of Unite, an excellent trade union. I am glad to follow my distinguished noble colleagues in this House; it is an honour. In truth, this has not really been a debate. The case has been set out with total clarity and force. Indeed, there have been no dissenting voices—I am hesitating slightly because my questions will be directed at the Minister, but the Whip is here and can no doubt pass on notes.

The context of the Bill is Labour’s new deal for labour, which would be a much broader and more effective way of addressing the problems that workers face, but the Bill is still valuable, and I congratulate my noble friend Lord Woodley on bringing it before us now, particularly given that is in line with the Government’s stated objectives.

In March 2022, the Department for Business, Energy and Industry Strategy stated that it intended to

“clarify and give some legal force to government expectations that employers should behave fairly and reasonably when seeking to change employees’ terms and conditions”—

that is exactly what the Bill does—and it went on to promise the broad outlines of what the Government wanted to achieve. Given that we are all agreed, including the Government, on the need to take action in this area, I want to highlight and reiterate questions that I hope the Minister will be able to answer.

First, does the Minister accept that this Bill, worth while but limited, will simply stop abusive tactics? That is its intention and that is its effect. It is not a blanket ban on fire and rehire; it is targeted exactly at abusive tactics. Does the Minister accept that that is the Bill’s intention and effect?

Secondly, does the Minister accept that the Bill focuses on being a last resort, where employers are genuinely facing financial ruin, and is not a generalised ban on changing conditions of employment where it can be justified? Does he also accept that there is a weakness in depending on the code? I am sure he would not agree that it is a toothless code, but I hope he can agree that it does not fully address the issues with which workers who are challenged in this way need support.

The issue here is consultation. Again, I quote from what the Government said in March 2022: that the process would involve

“fair, transparent and meaningful consultations”.

What we have in the code is a generalised objective that I suggest does not fully comply with that objective. There is a generalised call for consultation. Consultation must be meaningful, and to be meaningful, it requires not just disclosure of information but a response from the employer to the questions that the workforce puts in response to that information. It must not become just a sort of ritual—“Here’s the information, and we’re going to stick with doing what we wanted to do in the first place”; it needs to be a meaningful, to-and-fro process. I hope the Minister agrees that that is correct and that, given the strength of that definition, the code before us is insufficient.

I hope the Minister will also say that he understands that the 25% uplift on compensation from an employment tribunal, achieved way down the road, is not a sufficient penalty to ensure compliance with the code. My noble friend Lord Browne of Ladyton raised the problems that employment tribunals are facing. Given those problems, an extra 25% compensation way down the road is not a sufficient deterrent. Rather, for some employers it simply becomes a cost of business.

The key issue is that the Bill, narrowly focused, will be used to ensure that this tactic—we do not call it “fire and rehire”—will be used only when it is important for the survival of a business and the protection of employees’ jobs. Maybe the Minister thinks it does not quite get the balance right, but let us sort that out in Committee. I strongly urge the House to support the Bill.

Lord Watson of Invergowrie (Lab)

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I am grateful for the opportunity to speak in the gap. I would have had my name on the list, but I did not expect to be here for the start of the debate. I declare an interest, in that this year, I shall clock up 50 years of membership of the union that is now Unite—that is the fifth name the union has held over the years, through a number of nominal mergers, although it did not always feel like that. I was also a full-time official of the union for 12 years, before becoming an MP.

As an MP, I participated in 1992 in the passage of the Trade Union and Labour Relations (Consolidation) Act in another place, an Act probably best remembered for ending secondary picketing and the closed shop and introducing strike ballots, although it also provided some protections for workers in industrial disputes. But it is appropriate that that is the Act my noble friend Lord Woodley seeks to amend through his Bill.

I will not go into the various arguments as there is not time for that. Certainly, I agree that the whole issue of “fire and rehire” should be cast into the wilderness, except in the very rare cases my noble friend mentioned. However, I want to say something about the code. My noble friends Lady O’Grady and Lord Browne said that it was toothless and a waste of time, and that is true. My noble friend Lord Browne said that it comes into use only in industrial tribunals. As a full-time official, I remember representing members at many industrial tribunals. I am not a lawyer, and it was a real uphill struggle. It is always an uphill struggle, unless you have a top-class lawyer—like one or two noble Lords here today—to represent you. So that is not normally a situation in which it is easy to get a meaningful decision. The code is really a waste of time.

It is important that emphasis be put on the whole question of what companies seek to get away with and think they can get away with. It has to be made absolutely clear that those practices are totally unacceptable. The code will not assist with that, but this Bill would, and I look forward to contributing to discussions in Committee.

Lord Leong (Lab)

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My Lords, I thank all noble Lords who have contributed today, and especially acknowledge the contribution of the noble Lord, Lord Balfe, on the Conservative Benches.

I declare my interests as the director of several businesses and companies, as set out in the register. I have been in business for the past four decades and employed several thousands of people. One of the most important things I have learned from my time in business is that good employee relationships are absolutely vital for business success. My employees have worked hard to enable the business to succeed and grow, and several of them have become very close family friends. I believe that most businesses are good, responsible employers that do the best for their employees. This Bill is not targeted at businesses like those. No, the Bill will affect only a few bad apples in business, those who disrespect their employees and seek to exploit them. As already mentioned by my noble friends Lord Woodley, Lord Hendy, Lord Browne and Lord Davies, the Bill will not prevent any employer changing the terms of its employee contracts or arrangements because of an impending financial cliff edge.

I pay tribute to the dogged determination of my noble friend Lord Woodley, no stranger to long, drawn-out bargaining over employment rights, in bringing the Bill to the House. He has spent decades fighting for workers’ rights as a union official and a union general secretary, and now in this place he brings his Private Member’s Bill, the third attempt in recent years by Labour parliamentarians to seek to make this Government act and recognise that current employment law fails to address the injustice of fire and rehire. This omission, as others have argued, enables companies to threaten their workers with losing their jobs if the management decides it wants to weaken agreed terms of employment. Every year, such shameful bullying has a devastating impact on the security, lives and livelihoods of millions of workers in this country, and despite recent high-profile scandals, fire and rehire continues to be used. Naming and shaming does not work. Expecting bosses to do the right thing has not worked. It is long past time to change the law to make it work for workers.

When the most recent scandals appeared in the media, warm words from the Prime Minister were cold comfort to those who have suffered from the sharp practice of fire and rehire. It is not just the high-profile cases of well-known, iconic British companies that my noble friend Lord Woodley famously described as trading under this country’s name but not in this country’s interests. What is especially galling is that it appears that some of the companies that treat their workers so poorly in fact received financial support from the Government during the pandemic. The Government could have required that companies receiving assistance would not engage in such practices. They chose not to do so. Most shockingly of all, government departments, including local authorities and statutory bodies that really should know better, have offered procurement contracts to companies known to have threatened workers with fire and rehire tactics. Even with my low expectation of the Government, even knowing their heartless attitude towards hard-working people in the public sector, this came as a surprise to me.

There has also been an attempt to give the impression that fire and rehire has mainly been a last resort in the exceptional circumstances of the Covid pandemic. The thorough response from the TUC to the Government’s proposed code of practice demonstrates that this practice was being used before Covid, was used during Covid and has in fact gained prominence in negotiations during the years since the lockdowns ended. The TUC has estimated that one in 10 workers, almost 3 million people, have been subjected to fire and rehire tactics since the first lockdown. Young workers, women, black, Asian and minority-ethnic workers, as referred to by my noble friend Lady O’Grady, and those on low pay have been disproportionately impacted, which only exaggerates the inequalities that many of them already face. This alone is reason enough to consign fire and rehire to the history books by getting this Bill on to the statute book. Roads paved with good intentions, whether labelled promises, pledges or non-binding, just-published codes of practice, lead only in one direction. It is the workers, threatened with either losing their job or continuing to do it in worse conditions, who will always feel the heat. That is why so many of us support my noble friend’s Bill.

Labour’s new deal for working people recognises that outlawing fire and rehire means that workers can be safe in the knowledge that terms and conditions negotiated in good faith cannot be ripped up on threat of dismissal. They will be more secure and more able to plan and save for the future with legislation that gives them security in their pay and terms.

The Bill enshrines in law necessary improvements in consultation procedures where employers want to change employees’ contracts. It will make it illegal to dismiss workers for failing to agree to a contract that leaves them worse off. The Bill ensures that the highly restrictive trade union legislation introduced by this Government does not inhibit action to protect existing terms and conditions for employees. Recent experience shows that fiddling with a code of practice will not be enough. I agree with Unite the Union’s response:

“The idea that a ‘code of conduct’ is going to stop employers like P&O from doing this is just a bad joke”.


The TUC and lifelong veterans of the union movement, such as my noble friend Lord Woodley, know from bitter experience that in the real world, without legislation to prevent fire and rehire, workers will continue to be exploited.

The Bill offers the Government a chance, an opportunity to do the right thing to get ahead of the curve and outlaw this cruel and unjust practice, and to do it now. It will be a terrible irony if the issues addressed by the Bill are dismissed by the Government in favour of a non-binding code that offers weaker legal protections. The time is long overdue to put an end to fire and rehire with robust and binding legislation. My noble friend Lord Woodley’s Bill does just that.

Does the Minister agree that good industrial relations result in higher productivity? Also, will the Government bring forward the long-awaited employment Bill? I look forward to his response to my and other noble Lords’ questions.

The Minister of State, Department for Business and Trade (Lord Johnson of Lainston) (Con)

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I am, as always, extremely grateful to noble Lords for this debate. Before we begin, I direct Members of the House to my register of interests, although I do not believe there is any conflict relating to the Bill today. I am very grateful to the noble Lord, Lord Woodley, for bringing this Private Member’s Bill to this House. It affords us an extremely helpful debate, and I will go through some of the points shared by so many Members of this House who are rightly concerned that the primary function of a strong economy is a fair workplace regulatory framework.

I absolutely agree with the noble and wise comments of the noble Lord, Lord Leong, at the end of his address, that we should have strong relationships between the people who work in our industry and the people who employ them—with the shareholders, investors and consumers, and in fact with our entire habitat and environment. That is exactly the sort of harmony that this Government are trying to deploy.

I will talk about some of the technical elements around the Bill and dispel some misconceptions. The first misconception to dispel, if noble Lords will allow me, is that the P&O situation was a dismissal and re-engagement process. It was not. If I may, I will correct noble Lords who have conflated that situation—which in my view was absolutely abhorrent behaviour by an organisation with such lineage as P&O towards its staff, who had such loyalty to the company. It was strongly condemned at the time by the Government and is continually condemned by the Government today, and by me personally. I am aware that there is an inquiry by the Insolvency Service into P&O, on which it would be inappropriate for me to comment, but at no point should noble Lords conflate what P&O did with the concept of dismissal and re-engagement.

I will also touch on the principles around the proclivity of companies to use this practice to control their workforce. There is a great deal of anecdotal evidence, but there is not a great deal of specific evidence to suggest that this is as widespread as noble Lords may recommend. In fact, some of the high-profile cases—they tend to be so because they are relatively unique; this is important—often resulted in better outcomes for the employees post the relationship renewal with the unions. It is important to understand how big a situation we are dealing with here; it is not as significant as people suggest. The statistics vary significantly—from one in 10 to 3%, whatever that may be—which causes me concern. I am delighted to make a commitment to continue to do more work on how significant a so-called problem this is.

I will make two very important points about the principle of dismissal and re-engagement. First, for me, it is an extremely useful and powerful mechanism to allow employers to engage effectively with their workforce to create and establish new terms and conditions that may be appropriate for the modern age or for the needs of the company at the time. It is very important that we retain those flexibilities. The concept of dismissal and re-engagement is also very valuable in resetting and clarifying employment terms; I am sure that I am surrounded by people with far greater legal expertise on that than me. As I said, it is not simply a question of using this as a mechanism to bully staff; it is a very important legal process for the contractual relationship between the employer and the workforce.

My next point is something I think we are all agreed on. While I have great respect for the Bill of the noble Lord, Lord Woodley, and indeed for the noble Lord himself, we must have the flexibility to enable companies to manage their workforce in times of crisis. I am sure that, when we are faced with these situations ourselves, either as employers or workers, and we need to come together to respond to an economic crisis such as Covid, it is absolutely right that we have mechanisms to enable us to protect the workforce. This is about fairness, protecting workers and allowing us to have a flexible workforce. It will allow me and my friends, associates and children, and the rest of our citizens, to have the opportunity to work in a flexible environment that has not become too rigid or ossified to respond to economic volatility.

However, very importantly, this should never be used to bully the workforce. The code is very strong on this; it is extremely clear that it is not to be used inappropriately to try to force unacceptable terms on a workforce. Instead, what the code does is clarify the obligations of the employer to ensure that they have to consult with their workforce. For the first time, they have to—this is very important, when you look at the other reasons for dismissal and re-engagement—look at alternatives, not just to the overall plan but to how the individual workers themselves are treated.

There is the 25% uplift, and I take noble Lords’ comments, including those of the noble Lord, Lord Browne, on the tribunal service; I am very sensitive to that. I will come back to the noble Lord on his comments on the workability of that process, because it must be an easy-to-use process that is accessible; that is absolutely at the core of protecting workers’ rights. But we do have the 25% automatic uplift that can be fed into the process. There is an obligation—I believe the code advises it in every case—to consult ACAS when it comes to using dismissal and re-engagement. These are actually quite significant.

Clarity is very important. As we know from statutory codes—again, I defer to noble Lords who have greater legal experience than me—they are central in ensuring that we have a strong framework for navigating employment law and giving protections to workers, and, very importantly, also giving obligations to employers. Having been on both sides, and certainly as an employer, the more clarity I can have about how I can work with my workforce, the better. It is very clear from the tone of the document and this Government that it is the expectation that this is a last resort, that there is a significant degree of consultation and that every other option is exhausted before it is appropriate to use dismissal and re-engagement.

Lord Leong (Lab)

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I thank the Minister for giving way. Does he agree that the Bill offers employers the flexibility to consult their workers before the terms of the employment are changed? It does not ban the practice; it is just a last resort that offers a consultation period with the employees.

Lord Johnson of Lainston (Con)

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I am very grateful for that challenge. I will now turn to the Bill. As I said, many elements of its sentiment are wholly welcome, but its practical application would result in less fairness, wealth and job security than the noble Lord might wish. There are several reasons for that. First, the increased consultation becomes extremely onerous on companies. Often you have a very limited period of time to react to a significant economic circumstance. As I said, this is dismissal and re-engagement, rather than simply some type of long-term planning for a business. We must be extremely careful about the onerous conditions that we are placing on companies. I have looked through the Bill, and they are substantial and, I am afraid, heavily tilted towards union practices—maybe because every Member of the House who has spoken so far, apart from the Front-Bench spokesman opposite, is a member of a union. In many instances, not all companies have union bodies represented within them and not all workers are members of unions, so it is possible to conflate those two consultation processes, which is inappropriate.

It is also very difficult. While I have a great deal of sympathy with the principle of a so-called bankruptcy clause, it is not a position that those running a business want to be in that they can do something only if they are about to go bankrupt. The reality, as I think Hemingway said, is that you go bankrupt:

“Two ways. Gradually, then suddenly”.


You have limited time to act and have to be precipitous. You must try to prevent the point at which you go bankrupt, because otherwise all your staff will lose their jobs.

The principle of what we are discussing is how to protect as many workers as possible, in a difficult situation. The code does, but I am afraid that the Bill that the noble Lord, Lord Woodley, has put forward would put at risk the security of more workers than it would protect. Importantly, it removes the breadth and range of principles around which dismissal and re-engagement can be used. That is difficult, because businesses require flexibility and it should not be up to politicians to decide this on a case-by-case basis. That would cause enormous problems, reduce flexibility, make it far harder for businesses to operate appropriately, and reduce employment in this country and security for workers.

However—and I personally will be pleased to engage in this—before the code comes into force in the summer, there will be a full debate in both Houses. I have been very clear with my officials in the department and to my colleagues that we will keep this under review. It is right that we understand exactly how many companies are using this practice and to assess that more appropriately. As I said, I will look into the comments from the noble Lord, Lord Browne, around tribunals.

As the noble Lord, Lord Woodley, knows, I continue to be extremely desirous of continuing to engage with him on this important subject. Nothing is more relevant to this Government than strong relationships between investors, companies, the people who work in those companies, consumers, the broader citizenry and the environment to create the sort of harmony that gives us growth and security for the future.

Lord Woodley (Lab)

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I thank the Minister and your Lordships. I think we can all agree that this has been a stimulating and valuable debate. I do not know about anyone else, but I have certainly learned some lessons from today’s speakers and I thank them for their excellent contributions.

I thank my noble friend Lord Balfe; it was nice to have cross-party support, especially as nobody here has spoken against my Bill. Also, on this important issue, it is nice to listen to your own trade union roots. One interesting comment—which I thought about mentioning but did not—is that, in a recent analysis, in which around 1,800 participants were surveyed, 3% indicated that they had used fire and rehire. Across the business population of Britain, as was said that this could equate to 40,000 employers; it is actually 48,500 employers. So this is not a small issue. If you look at the scope and size of the problem surrounding us at the moment, you see that it is almost a pandemic.

As always, I found my noble friend Lady O’Grady’s contribution stimulating. She is correct to suggest, again, that the Government did not give very strong commitments to stop these abuses happening in the past and, to make sure they do, they need to put legislation in place to stop the casualisation of our industry, which blights working people. There is no doubt in my mind that assuring the importance of workers’ rights from day one would go some way to helping prevent the abuse that is out there.

I thank my noble friend Lord Hendy for his forensic analysis of the Bill and for explaining the legal logic behind it. It is always interesting to listen to an expert and it is good to know that people know what they are talking about. We all owe him a great debt of gratitude for drafting this elegant and powerful piece of legislation. He points out that the millions of predominantly low-paid, black and ethnic minority workers who will be, and are indeed being, attacked by fire and rehire are not protected at all under the current proposals, which is why we need legislation. I thank him for those comments.

I thank my noble friend Lord Prentis for confirming what I have said: this is not just about the private sector but is endemic right across the public sector. The examples that he gave were clear for everybody to see.

I thank my noble friend Professor Lord Sikka for highlighting the important economic advantages to the Bill that are so desperately needed to rebuild our broken economy and to give people security in their jobs and as workers. All that is really important and is contained within the Bill. If anyone disagrees with me that at the moment our country certainly needs that security—there is no doubt at all about that.

On my noble friend Lord Browne’s comments, I did not appreciate until he mentioned this earlier today that the Government were indeed thinking of bringing back employment tribunal fees. When you realise what that could mean in relation to the proposals that the Government have down there, never mind the outrageous time it takes to even get an industrial tribunal heard, that is detrimental to the well-being of workers right across our country.

To my noble friend Lord Davies, I say that there is no doubt that a new deal would be incredibly important for us. He mentioned that the limitations within the code of conduct are clearly there for everybody to see, and he highlighted, as indeed did numerous speakers today, the limitations of what is presently on the table. That is why it needs changing.

I am grateful to my noble friend Lord Leong and, as I said in my speech, I am grateful for the support that my own party has shown for the need for change and for the Bill. It is really important that we bring in the legislation that is needed, and I sincerely hope that if we cannot get this Government to move at the moment, my own party in power will indeed honour its commitments.

The Minister mentioned P&O and said that, to some extent, it was not a case of fire and rehire. I accept those comments, but at the same time, with respect, it got away with it, and did so when the Government promised that it would not. It is as simple as that. The Minister said that what is actually happening out there may not be as significant as speakers point out. I say to the Minister that, with respect, he is absolutely wrong on that—hence the comments that the noble Lord, Lord Balfe, made in his contribution.

I thank the Minister for his response, but I am bitterly disappointed that, although the Government accept that there is a problem with fire and rehire, they are not prepared to give real support to struggling workers who are facing the prospect of being forced out of their jobs and seeing their wages and conditions slashed. It is simply unacceptable that workers can be fired and rehired without proper consultation and fair compensation, and, despite the Minister’s assurances, the code of practice is simply no substitute for legislation, as all speakers today have expressed to him very clearly. As I said, nobody here today has opposed the Bill.

I am also disappointed that the Minister has not answered satisfactorily the straightforward questions that I posed to him, and I respectfully request that he write to me on those particular issues.

I will just say this to the Minister. We have nothing to fear from the Bill and, if I am honest, I have yet to hear any coherent argument against it. If the Government have serious objections, I urge them and the Minister to engage with the Bill in Committee. I thank all noble Lords again for their contributions and for being part of this debate today and I beg to move.

Lord Woodley

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That the order of commitment be discharged.

Lord Woodley (Lab)

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My Lords, I understand that no amendments have been set down to the Bill and that no noble Lords have indicated a wish to move a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of commitment be discharged.

Lord Woodley

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That the Bill do now pass.

Lord Woodley (Lab)

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With your Lordships’ indulgence, I will say a few words. Fire and rehire, as I have said here many times, is a despicable tactic used by unscrupulous employers to rip off workers, cut costs and boost profits—notwithstanding the very rare occasions when it may be necessary, as a last resort, to ensure a company’s survival. That is why it gives me so much pleasure to see this Bill make such progress in the House, and I warmly welcome the cross-party support that it has secured. I pay tribute to my noble friends across the House who have spoken up for this important legislation.

There is also some noteworthy history behind the Bill, and I pay tribute to the people and organisations who have made this progress possible today. I thank my union, Unite, for blowing the whistle on this abusive practice back in 2020, as hugely profitable corporations used the Covid pandemic as cover to undermine workers’ pay and terms and conditions. I thank Unite for raising awareness so successfully both among the public and here in Parliament.

I pay tribute also to my honourable friend in the other place Barry Gardiner, who chose fire and rehire as his Private Member’s Bill the following year. I thank him for the fantastic campaign that he ran with this Bill and for agreeing to carry it forwards in the other place—with your Lordships’ approval, of course.

I pay tribute to my noble friend Lord Hendy and Professor Keith Ewing from the Institute of Employment Rights for drafting this powerful and elegant piece of legislation, and for helping me to navigate through the legal quagmire associated with this scandalous practice.

I also thank the other trade unions that backed this Bill—over 20 unions representing working people across the UK economy, from bakers to bartenders, scientists to civil servants, prison officers to professional footballers—in fact, the whole of the British TUC.

I also thank my own party, the Labour Party, for making the fight against fire and rehire, and against current exploitative employment practices, at the forefront of its offer to the British public at the next election.

I am confident that, whatever future befalls the Bill, there will soon be no place for fire and rehire abuses in our economy and nowhere for bad bosses to hide in the statute book. It is an honour to play, I hope, a small part in bringing such desperately needed change a step closer. I beg to move.