Employers in the UK have found a new way of attacking workers’ rights. Simply fire your staff, then offer them their old jobs back, only with worse pay and conditions.
“Fire and rehire” is the controversial practice of firing workers and rehiring them on a new contract, usually with worse terms and conditions than before. This is illegal in much of Europe, but in the UK it has become a go-to tactic for companies looking to save money during the pandemic.
A worker who stands to be fired and rehired from their job at Jacobs Douwe Egberts (JDE), a coffee factory in Banbury, Oxfordshire, in South-East England, told VICE World News they were, “Currently I’m sick with stress. [I’d] lose £12,000 a year and the new pattern [would] be two days, two nights on 12-hour shifts.”
The factory, which produces coffee for Kenco, Tassimo and L’Or – all of which are owned by the Dutch company JDE Peet’s – is currently the site of a significant industrial dispute over pension changes and the practice of dismissal and re-engagement, more commonly known as fire and rehire.
Speaking on condition of anonymity due to fears of reprisals at work, the worker said they were worried about having to downsize their house. “You can only pay what you can afford,” they said. “It’s disgusting. I think this fire and rehire law is shocking. It has worried me and my family badly.”
The dispute at JDE Banbury affects 291 workers, who refer to themselves as “the Banbury 300”. The proposed changes would reduce the amount workers receive in pensions and introduce a shift pattern where 12-hour days would be standard. According to Unite, the union representing the JDE staff, some workers stand to lose £12,000 from their pay.
Workers at JDE were supposed to sign up to the new contract by the 17th of May, but however JDE re-entered talks with Unite after they threatened to strikes. The talks collapsed, the 24 hour strike – the third in the duration of the dispute – went ahead on 26th May. No resolution was reached so workers are expected to strike yet again on the 5th of June.
The struggle also prompted action from workers at JDE plants in France, the Netherlands and Germany, who have launched solidarity campaigns and are considering work stoppages.
In May, workers in Banbury launched an “action short of a strike”, in the form of a refusal to accept overtime. In response, Unite alleges that the company instituted a summer holiday ban to keep to the production schedule.
Joe Clarke, Unite national officer for the food and drink industry, says JDE are “tightening up the availability for people to take holiday through the summer months as a direct reaction to us giving notice on industrial action”. JDE has denied this, stating, “We have not banned summer holiday requests – holiday requests can still be submitted but will need to be approved depending on the impact they will have on the business.”
Research published by the Trade Union Congress in January of 2021 found that, throughout the pandemic, one in ten workers had been told to reapply for their jobs on worse terms and conditions, or face the sack.
Tim Sharp, Senior Employment rights officer, said, “There does appear to have been a surge in the tactic since the pandemic hit… we’re clearly living in a time of great economic uncertainty, workers are worried that they are going to lose their jobs. If you are an unscrupulous employer, this is the moment to cut terms and conditions.”
He added that a recent development to the fire and rehire tactic is that “employers are not using it to unlock what look like deadlocked talks”, as they had done previously. Instead, '“it’s been put on the table right at the beginning as employers try and intimidate workers into accepting what they want them to accept”.
According to Sharp, fire and rehire has become so endemic in some industries, such as hospitality, that those sectors are struggling to attract new workers, as they realise they could have better terms and conditions elsewhere.
Prominent examples of fire and rehire include British Gas, whose deployment of the practice prompted a three-month-long strike and saw hundreds of employees dismissed after they refused to sign new contracts. Recently, catalogue retailer Argos and cereal brand Weetabix have been in disputes with unions because of their use of fire and rehire tactics.
The practice has sparked industrial action in several workplaces. Striking bus drivers in Manchester recently secured a deal with their employer, Go North West, in which the operator promised not to use fire and rehire in future, following 80 days of strike action, the longest in the Unite union’s history.
Polling suggests that three-quarters of the British public think the tactic should be banned, and the Prime Minister himself has called fire and rehire unacceptable.
Even Jacob Rees Mogg, the right-wing leader of the House of Commons, said in parliament that “employers threatening to fire and rehire as a negotiating tactic are doing something that is wrong and decent employers do not do”.
But while the government has condemned fire and rehire, it has maintained that businesses in financial difficulty can use it to save jobs. Paul Scully, Parliamentary Under Secretary of State in the Department for Business, Energy and Industrial Strategy, said in a debate in parliament that “businesses in real financial difficulty do need the flexibility to offer new terms and conditions to save as many jobs as they can”. This does not apply to JDE Peet’s, however, which expects 3 to 5 percent organic growth for 2021, and recorded €308 million in profit in 2020.
Members of the Banbury 300 spoke to VICE World News from the picket line outside the factory gates during their second 24-hour strike, on the 15th of May. They all asked to remain anonymous for fear of reprisals at work.
One worker, who had been at the factory for 21 years, said, “It’s a life changing reduction in annual wages. It’s devastating, I’m in a state of despair, to be honest. Basically, it’s a 20 percent cut in my annual salary, my pension has been destroyed and I’m changing from what was OK as a shift pattern to a crappy shift pattern.”
Another worker, who has been at the factory for 28 years, had been looking forward to retiring. Thanks to the changing contracts, they said, “I can’t retire for another ten to 15 years. That’s just been snatched away – there’s no chance now of taking it to 65 without any losses.
“We make soluble coffee, which is up due to Covid, but also it’s on a marked increase anyway. It’s just to cream as much profit as they can at the top for the very wealthy, and to hit the workers who actually make the products.”
A third worker said, “[I’m] disappointed to be treated like this. It’s a family firm for me – my wife works here. I’ve got a couple of cousins who work here, who are here today. My grandparents moved from Birmingham when this place opened 60 years ago, so I’ve got links to this place from the day it opened. So to be treated like this when my family has given so much to this [factory] in its various guises is disappointing.
“Everything I’ve been planning over the last five years, literally overnight has gone. I’ve now got to re-evaluate and re-jig my whole life basically to retire, not when I wanted to, [which was] hopefully earlier than 65. But the way things are going, will I be retiring at 65, 67 or 70?”
JDE told VICE World News that “there is an overwhelming need to reset Banbury manufacturing because it is not competitive compared to other factories. We have been talking to Unite and our associates since 2019 about resetting working practices that have not changed in decades. Our proposals do not include any redundancies and the current proposals see the majority gain financially with compensation for those who are financially impacted”.
Unite has claimed that JDE’s method of consulting workers with a series of aggressive one-on-one interviews amounts to intimidation. “Some workers, male and female, have been reduced to tears by bullying bosses,” said Unite. Numerous workers confirmed this to VICE World News.
A worker on the negotiating committee said, “Some of the ways the meetings were handled were disgraceful. The conduct of the management was shocking, to be quite honest. Some of the managers, the way they conducted themselves was fantastic, they showed empathy, showed compassion, but… you know, there are people’s lives changing. Some people are losing over £10,000 a year, but the way some of these management treated people, it was just like, ‘I don’t care.’”
JDE said, “We completely reject any allegations of intimidation. We have followed the appropriate legal process with planned individual consultations for impacted associates – all associates had the right to be accompanied by a representative if they wished.”