Union wins Tesco 'fire and rehire' case

In 2021, Tesco proposed a controversial plan to terminate the contracts of some distribution centre staff and rehire them at lower pay, sparking a legal battle with the Usdaw union. The union argued that the retained pay, which had been described as 'permanent' in employee contracts, should not be removed. Tesco, however, contended that this pay was a 'contractual mechanism' that could be altered. After an injunction was granted in 2022 to halt Tesco's plans, the supermarket successfully appealed the ruling. However, the Supreme Court ultimately sided with Usdaw, stating that Tesco could not use its contractual rights to diminish employees' pay. This ruling was seen as a significant victory for the union, which emphasized the importance of the retained pay as a key component of workers' compensation. Tesco acknowledged the Supreme Court's decision, noting that it affected a small number of employees and that the majority of distribution centre workers did not receive the enhanced pay. The company had previously offered a competitive package to those affected, leading many to accept the terms. The union's general secretary expressed satisfaction with the outcome, highlighting the need for fair treatment in industrial relations and condemning the tactics employed by Tesco during the dispute.