Fire and Rehire

Sheryll Murray Excerpts

Tuesday 27th April 2021 Westminster Hall

[Mrs Sheryll Murray (in the Chair)]

I remind Members that there have been some changes to normal practices in order to support the new hybrid arrangements. Timings of debates have been amended to allow technical arrangements to be made for the next debate. There will also be suspensions between each debate. I remind Members participating physically and virtually that they must arrive for the start of debates in Westminster Hall. Members are expected to remain for the entire debate.

I must also remind Members participating virtually that they are visible at all times, both to each other and to us in the Boothroyd Room. If Members attending virtually have any technical problems, they should email the Westminster Hall Clerks’ email address. Members attending physically should clean their spaces before they use them and as they leave the room. I also remind Members that Mr Speaker has stated that masks should be worn in Westminster Hall.

We are expecting votes this afternoon, so if there is any Member who needs to leave to vote, could they please indicate now? Thank you very much.

[Kate Osborne (Jarrow) (Lab)]

I beg to move,

That this House has considered fire and rehire practices.

It is a pleasure to serve under your chairmanship, Mrs Murray. This debate has been oversubscribed, which I think says something about the strength of feeling and the level of anger at this appalling practice. I thank all hon. and right hon. Members for taking part today. One cannot help but notice the lack, or rather the complete absence, of Conservative MPs from today’s call list. I do hope this is not a reflection on how seriously the Government take this issue, but I suspect that is the case. Perhaps the Minister can prove me wrong.

I would like to pay tribute to the workers of our country—the women and men who have battled so hard throughout the past 14 months to keep the country going in the face of covid-19. Many workers have lost friends, colleagues and family members to this terrible virus, and now at least one in 10 of them face a further pandemic of opportunistic employers using covid-19 as a cover to dramatically reduce workers’ pay and terms and conditions. Fire and rehire is a process that involves sacking workers and hiring them back on lower wages and worse terms and conditions—a practice that, according to research published earlier this year by the TUC, has had a disproportionate impact on black, Asian and ethnic minority workers, young workers and working-class people.

However, fire and rehire is not new. In 2009, the Confederation of British Industry boasted of using the financial crash to establish a so-called flexiforce, in effect using economic uncertainty as a cover to replace permanent workers with flexible workers. The economic uncertainty stemming from the pandemic has provided another opportunity for big business to shift power even further away from workers so that they can boost long-term profits for shareholders. These are some of the same companies that have made use of public money through the Government’s job retention scheme.

Fire and rehire must not be allowed to continue. Workers should not be forced to choose between losing pay or losing their jobs. Parliament must act urgently to outlaw this form of industrial blackmail. That is why I, along with my union Unite, am calling for fire and rehire to be included in next month’s Queen’s Speech, either in the Employment Bill or as stand-alone emergency legislation. It is a national emergency and disgrace that one in 10 workers are currently threatened with a practice that, in the words of the Prime Minister, is “unacceptable” and in the words of the Minister here today is “bully boy tactics.” I am not entirely convinced that the Prime Minister knows what fire and rehire is or what it is doing to thousands of workers across the UK.

Fire and rehire is not a new phenomenon but it has gained prominence because of the conduct of many major employers, such as British Airways, Heathrow airport and British Gas, some in circumstances that they claim to be justified by the covid pandemic. The practice has highlighted how weak the current unfair dismissal laws are in this country and how they need to be strengthened.

I take this opportunity to highlight the example of my constituent Matthew from Hebburn, who is one of many of my constituents who have been affected by fire and rehire. Matthew had worked for British Gas for 16 years. He was an exemplary worker, once proud to drive his blue van, who would have been happy to see out the rest of his working life with the company. He is now newly self-employed, having been one of the 300 to 400 staff who lost their jobs for refusing to sign up to new contracts, terms and conditions imposed by British Gas for nothing more than corporate greed.

Despite making more profit than in the previous year, British Gas has used the pandemic as a cover to impose a “take it or leave it” 15% pay cut and other changes that have affected the time their workforce spend with their families, by making the working week three hours longer. That is a whole month of additional labour added to the year.

Last year British Gas issued Matthew with a fire and rehire ultimatum, giving him and his colleagues a deadline of 23 December. They were told that if they did not agree with the terms offered, worse terms would be forced upon them. This deadline was pushed back until 25 March. Matthew refused to be bullied by British Gas and was therefore given his notice on Monday 29 March. I send solidarity to Matthew and all other workers.

What has happened to loyal workers like Matthew at British Gas is an absolute scandal. It shows utter contempt for the loyalty many have shown for much of their working lives. British Gas, Centrica and their chief executive officer Chris O’Shea should be ashamed of this reckless corporate bullying. It is sad to see what has happened to British Gas, once a nationally respected institution but now a poster boy for the virus of poor employment practice that is spreading like another contagious deadly disease across the UK.

In London, staff at Goodlord were given a choice to take a pay cut or become unemployed. Goodlord asked staff to take a contract with a lower rate of pay, which is below the London living wage.

In Manchester, Go North West drivers have been on an all-out strike for over 50 days against cruel fire and rehire abuses by bosses. The company wants to fire and rehire its drivers and force them to work longer for no additional pay, while also cutting sick pay for drivers with more than five years’ service.

In Loughborough, global field service engineers employed by Brush Electrical Machines, owned by Melrose, are being balloted for strike action in response to fire and rehire pay cuts of up to £15,000. The proposed contracts include reductions to overtime rates, allowances and holidays. The engineers have been threatened with redundancy if they do not sign the new contracts, which will leave them on pay rates well below industry standards.

In Oxfordshire, Jacobs Douwe Egberts will stop workers from taking summer holidays to thwart an overtime ban, starting on 1 May, in an ongoing fire and rehire dispute. My own union Unite is representing its members in all these disputes, but the problem goes much deeper and will only grow if the job retention scheme comes to an end.

Last year, the Government asked the Advisory, Conciliation and Arbitration Service to produce a report on the full extent of fire and rehire, which was received by Ministers on 17 February. Despite numerous pledges to release the report and respond to it, the Government are still dragging their feet, leading us to wonder what ACAS has written that the Government do not want us to read.

On 23 March, I asked the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Derby North (Amanda Solloway), during Business, Energy and Industrial Strategy questions if she could confirm when we would get a chance to see the ACAS report. The Minister told me that the Government find the practice of fire and hire “unacceptable”, but could not give me a date or time when the ACAS report would be released. Here we are, one month later, and the Government are still dragging their feet on this. I hope the Minister will tell us today when the Government intend to make the ACAS report available, because they certainly appear to want to bury it.

We have heard a lot from this Government about levelling up and how Brexit will give us the opportunity to have higher standards across the board. Now is the Government’s chance to prove that they are serious about that. They must understand that well-paid, secure work is good for the economy, and greater security for workers would mean a stronger and quicker recovery. Our friends across Europe understand this. The practice of fire and rehire is already banned in Ireland, Spain and France, and is seen as unacceptable in other competitor economies, where Governments step in to defend their workers. Last week, the Government moved quickly to stop the European super league in its tracks. It showed that they can make things happen when they want to—and feel that they will get a popularity bounce off the back of it.

The Government have made all the right noises about fire and rehire, but so far have done absolutely nothing about it. I hope the Minister will tell us when the Government will back up their words with action and act to outlaw this immoral practice. If this Government are serious about levelling up and raising standards, they must commit to ending fire and rehire once and for all. I hope to see that in next month’s Queen’s Speech, either in the Employment Bill or in stand-alone emergency legislation.

[Mrs Sheryll Murray (in the Chair)]

This debate is very over-subscribed, so I suggest that the first speaker takes four minutes and the rest take three minutes. If that is the case, everybody should be able to get in.

[Ian Lavery (Wansbeck) (Lab) [V]]

It is a pleasure to serve under your chairmanship, Mrs Murray. It is important to recognise the situation facing the ordinary workers in this country who are facing these draconian fire and rehire measures. I congratulate my hon. Friend—my great friend—the Member for Jarrow (Kate Osborne) on bringing this debate to Westminster Hall today. It is the working people who have kept our country on its feet. They are the true heroes in every sense of the word. It is the keyworkers, mainly low-paid workers, not the hedge fund managers, Government cronies or indeed the highly paid, who are being subjected to what the Minister quite rightly framed as “bullyboy tactics”.

Security of employment is so important to hard-working individuals and their families. Is it not right that ordinary people are treated with absolute dignity and fairness, not as inconvenient necessities by fat cat millionaires who frankly would sell their own grandmothers for a pound?

The scourge of fire and rehire practices, which have always haunted workforces, has expanded rapidly since the beginning of the pandemic. The Prime Minister himself stated that it was capitalism and greed that got us through this covid pandemic. My message to the Prime Minister is that it was the workforce of this country that got us to where we are today, and the reward for many of them is fire and rehire. These are human beings. They are real people, with mortgages, rent payments, credit cards and credit, with kids and families, with expectations and with ambitions, who have been treated appallingly by employers who care little and a Government that talk the talk but fail to walk the walk. As my hon. Friend said in her opening speech, whether it be Goodlord, where salaries are being slashed by up to £6,000, whether it be Go North West where salaries are being slashed by up to £2,500, Jacobs Douwe Egberts with £7,000 a year lopped off salaries, or Melrose Brush with potentially £15,000 a year slashed off people’s salaries. These are real people. What about the Heathrow worker with 40 years’ service, expected to take a 39.1% pay reduction? The list goes on and on.

This is legalised robbery; it is legalised theft, with astonishing consequences for those doing the right thing. It is ruthless corporate bullying. It is intimidation. It is harassment of people with families, people with bills to pay. We all agree that this is a time of great uncertainty. Fire and rehire must be outlawed. If it is good enough for Ireland, France and Spain, by goodness it is good enough here in the UK. Where is the much-awaited ACAS report, Minister? Come clean. What are you hiding? Publish it if you can. This is simply unacceptable in modern-day Britain. Coming out of a year-long pandemic, Minister, ensure that the draconian practice of fire and rehire is outlawed in the Queen’s Speech. Fix this now and fix it for good—and for those workers out there, join a union.

[Mrs Sheryll Murray (in the Chair)]

Order.

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[Navendu Mishra (Stockport) (Lab) [V]]

I refer Members of the House to my entry in the Register of Members’ Financial Interests, in particular my membership of Unite. I start by thanking my hon. Friend the Member for Jarrow (Kate Osborne), who is a good friend, for securing the debate.

The pandemic has changed the world of work for almost all workers. We have seen some employers go above and beyond in supporting their employees, but, sadly, we have also seen some employers using it to attack wages and terms and conditions for their own workforce. I am proud to be a Labour MP, so it should not come as a surprise that I am a socialist and trade unionist. Trade unions offer workers a voice in the workplace, and data tells us that unionised workplaces are not only safer, but benefit from better terms and conditions. I am grateful to all trade unions for standing up for their members against employers who are taking advantage of the pandemic to increase profit margin at the cost of their own workers.

One such employer is British Gas. The parent company, Centrica, has been in a long-standing dispute with the GMB union. I have had a GMB picket at the British Gas office in my own constituency, in Brinnington ward. A few days ago, the media reported that almost 500 engineers had lost their jobs after refusing to be forced into new contracts—a truly shameful day for a household brand such as British Gas. Rightly, the public will not forget how British Gas Centrica treated its workforce.

Unfortunately, there is another dispute in Greater Manchester at Go North West buses. Unite members at this bus operator had been on the picket line for more than 60 days. They have been blackmailed into a taking a significant pay cut. Drivers at Go North West earn on average £24,000 per year, but changes mean they will have to work much longer hours for the same pay. In real terms, that means a £2,500 pay cut. I have visited the picket line on three occasions to show my solidarity with Go North West employees.

Fire and rehire has been used as an aggressive negotiation tactic by household brands. That is completely unacceptable, and we need urgent action, not warm words from the Government. Several Members have already asked when we can we expect the ACAS report to be made public. As constituency MPs, we need to see the report to hold the Government to account.

Urgent Government action is needed to end fire and rehire bullyboy tactics. It is all well and good to clap on the doorstep for our amazing key workers, but what they need is clear Government legislation against fire and rehire tactics, rather than vague platitudes from Ministers. Will the Minister call out bad employers such as British Gas, Goodlord, Brush Electrical Machines and Go North West? We need real action from the Government, not warm words.

[Mrs Sheryll Murray (in the Chair)]

Thank you for carrying on during the Division bell.

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[John McDonnell (Hayes and Harlington) (Lab) [V]]

I want briefly to outline some of the implications of fire and rehire in its latest use for individuals, families and communities. I refer to my entry in the Register of Members’ Financial Interests, and I thank my hon. Friend the Member for Jarrow (Kate Osborne), who has been an asset to her constituency and the House since she was elected.

The latest wave of fire and rehire, which is not a new phenomenon, started in my constituency at Heathrow through the activities of British Airways and Heathrow Airport Ltd. Both companies saw the pandemic as an opportunity to implement their long-held strategy of cutting wages and undermining working conditions and terms of employment. The wages and the terms of employment were fought for over generations by trade unions to ensure that people got a decent wage and were treated properly at work. That is all people wanted.

The reaction to the attempt to cut wages on such a scale and to tear up employment agreements was, first, absolute anger. The frustration among the workers at Heathrow was palpable. The staff were so loyal. They were proud to work for British Airways, the national carrier, and many had worked there for decades. Whole families depend on the airport, working for either BA or Heathrow Ltd. They faced wage cuts, even though house prices and rents in my area are so high, and were under real stress, and they were looking at whether they could maintain their livelihood and keep a decent roof over their head.

That stress has brought about almost a mental health crisis in our community. There is real resentment because those companies have made vast profits and taken furlough money from the Government, and they were simply using a short-term crisis to impose long-term pay cuts. Owing to the resolution of my community, individual workers, Unite the Union and others, we fought back and have settled as best we can to protect people, but the protection can come in the longer term only if the Government act and introduce legislation to ban the practice of fire and rehire once and for all.

Lord Hendy reminded us a couple of days ago that fire and rehire is not a new practice. The general strike was provoked by it when the miners were sacked and brought back to work only if they accepted wage cuts. I warn the Government: if they do not act and change the legislation, there will be more industrial action and more disputes, so they need to act with urgency.

[Mrs Sheryll Murray (in the Chair)]

I thank everyone for keeping to the time limit, because everybody has got in. I call the SNP spokesperson, Gavin Newlands.

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[Imran Hussain (Bradford East) (Lab)]

It is, of course, a pleasure to serve with you in the Chair, Mrs Murray. I declare my interest as a member of Unite, GMB and Unison.

I join other hon. Members in thanking my hon. Friend the Member for Jarrow (Kate Osborne) for securing this important debate on fire and rehire tactics and for the timely manner in which she has done so, with the outrageous firing of hundreds of British Gas employees earlier this month, just because they refused to be bullied by management into signing contracts that put them on worse pay, and worse terms and conditions. My hon. Friend spoke passionately about that case and the abusive bullying behaviour of British Gas’s management. She made a sound contribution that delivered a strong defence of workers’ rights and the protections that should be afforded to them, but which sadly this Government have denied them. My only regret is that we are having to have this debate following this mass firing at British Gas because the Government would not step in when they should have properly done so.

I thank my hon. Friends for their passionate contributions. Let us be honest: the point has been made that it is only Members on the Opposition side who have contributed because the Government could not even convince their own Back Benchers to turn up to defend the fire and rehire tactics that have become endemic on their watch. There is not only the cases of their own constituents who have faced fire and rehire tactics, but the use of these tactics by major companies that have continued to make a profit throughout the pandemic.

We must remember that fire and rehire tactics are not a new phenomenon, a point that has been made in this debate. They had been around long before the coronavirus pandemic. However, the increasingly precarious nature of our economy and the Government’s refusal to do anything about it, along with the uncertainty created by the pandemic, have given unscrupulous employers the cover they need. Let us be clear: the employers making use of these frankly deplorable tactics are unscrupulous—there are simply no two ways about it.

Under the threat of permanent dismissal at a time when the jobs market could not be more challenging, these unscrupulous employers are bullying their staff into signing away their original contract. They are bullying them into signing a replacement contract where pay is lower, rights are weaker and conditions less favourable, and they are shoving those inferior contracts down the throats of their workers, who know full well that they cannot refuse without being fired for good, as we saw at British Gas.

Despite that despicable behaviour, and the fact that such shameful tactics amount to nothing more than legalised blackmail of staff by employers, fire and rehire inexplicably remains perfectly legal under the Government, and big businesses such as Tesco and the coffee giant Douwe Egberts, which have seen rising profits during the lockdown, are continuing shamelessly to use them.

As a result, those who cannot stand up to their employers and have to begrudgingly accept the new contracts face incredible hardship, going from a job that often comfortably supported them and their families to now being forced to rely on food banks, handouts and social security to make ends meet. Indeed, we all saw the heart-breaking stories during the industrial action taken by GMB members at British Gas where engineers made it clear that they were not striking for themselves but for the young children they needed to support. Fire and rehire tactics do not just leave workers worse off; they leave their families worse off too.

However, fire and rehire tactics are not just bad for working people, who are told to work harder but at the same time paid less; they are bad for our economy too. By being able to change contracts on a whim, fire and rehire tactics are allowing bad employers to thrive and get ahead, cutting wages even at a time when many of them are making bumper profits because of the lockdown. As a result, good employers that look after their staff, pay them good wages and offer favourable conditions are being squeezed out, unable to compete with the bad employers. That is hardly the positive example of levelling up or building back better, as the Prime Minister has pledged time and again. That is why the Labour party, the trade unions and working people up and down the country have been calling on the Government to step in and act, to deliver the legislation that will bring a final, definitive end to the use of fire and rehire tactics for good, just as has been done in Ireland and Spain, as we have heard.

Instead of outlawing fire and rehire, all the Government have been able to offer are warm words and consultation—a point that has been made by a number of hon. Members. Warm words, however, do not pay bills, keep roofs over people’s head or put food on the table. As we saw at British Gas, warm words do not keep people in employment. The consultation that the Government have commissioned with ACAS still has not been published weeks after reporting back to base, with findings reportedly still being considered. I say to the Minister that this is not difficult. The findings and recommendations of the ACAS consultation are obvious for all: fire and rehire is bad for everyone. The Government should ban it, so why are they dragging their feet and what are they waiting for?

Last week, the Prime Minister spoke of dropping a “legislative bomb” to stop the European football super league, so they can act when they want to. However, he cannot even muster as much as a legislative firecracker to stop fire and rehire. Only last Wednesday, in response to my hon. Friend the Member for Liverpool, Riverside (Kim Johnson) during Prime Minister’s questions, the Prime Minister could not even remember the GMB dispute with British Gas and the mass firing of workers who refused to be bullied. No one should ever try to tell us that this Prime Minister is in touch with working people.

Instead of the Government looking out for employment rights, it has again fallen to trade unions to protect working people and to oppose bully-boy tactics. Unite secured a resolution of the dispute with British Airways and continues to oppose Go North West’s buses plans, and the GMB had a valiant fight to protect jobs and livelihoods at British Gas, but their job is made harder by the fact that the Government will not step in to help them by giving the vital legal backing that they need.

The use of fire-and-rehire tactics by unscrupulous employers is a stain on our economy. The contributions made by hon. Members during this important debate make one thing clear: we cannot just temporarily stop the use of fire-and-rehire tactics during this pandemic; we need to end them for good. To that end, the Government must introduce proper legislation, backed by real enforcement, before it is too late—before we see another big bully-boy employer such as British Gas lay off staff and impose new contracts, dismissing the rest who refuse to be bullied.

The Minister must confirm, as I hope he will and as we have called for, that the Government will bring forward such a measure as a matter of priority in the long-awaited and much-delayed employment Bill in next month’s Queen’s Speech. If he does not give a proper response today and resorts to a wishy-washy one—frankly, a trademark of this Government—the consequences for every worker who has been blackmailed and bullied, every family forced to turn to food banks, and every child forced into poverty, will land firmly at his Government’s doors.

[Mrs Sheryll Murray (in the Chair)]

Minister, will you leave a couple of minutes at the end for the person in charge of the debate to conclude?