‘You’re fired!’ … and no longer rehired

04 June 2025

Clause 26 of the Employment Rights Bill makes it automatically unfair to dismiss an employee for rejecting a contractual change. This means that the concept of fire and rehire will soon become unlawful except in very limited circumstances.

As early as October 2025, this change will mean that the usual ‘fire and rehire’ backstop for businesses wanting or needing to make changes to terms and conditions will no longer be available. The narrow exception is where the business is genuinely at the point of insolvency – and this still needs to be evidenced and accepted by the Tribunal. Not only that, but it must also be shown that there was no other option apart from the dismissal route.

Should the employer manage to prove that this was in fact the case, the dismissal will not be rendered automatically unfair, but it will still be subject to the usual test of reasonableness as applied to any dismissal. This would include evidence of consultation, attempts to gain agreement, and consideration of the alternatives to the fire and rehire approach.

Without this backup, employers will need to ensure that any planned changes are effectively communicated to staff and that a genuine, balanced process is adopted for introducing the changes.

Worried about what the end of fire and rehire means for your business? Backhouse Jones can help you implement lawful and practical change strategies that protect your business. Get in touch today for expert employment law advice.

This article was written by Laura Smith.