A MAJOR union victory was won in the Supreme Court today after judges ruled in favour of Usdaw members against “fire and rehire” tactics by their employer, Tesco.
The retail workers’ union took legal action against Tesco’s proposals to fire staff at its Daventry and Lichfield distribution centres and rehire them on lower pay in 2021.
Workers had previously been offered “retained pay” — additional payments given to employees who agreed to relocate in 2007 when the supermarket restructured and closed some distribution centres.
But in 2021, the chain wanted to bring retained pay to an end and told staff it would be removed in return for a lump sum, otherwise they would be fired and reoffered jobs on the same terms but without increased pay.
Tesco argued bosses were using a “contractual mechanism” open to employers.
But the union argued that “retained pay” was described as “permanent” in the workers' contracts and therefore could not be removed.
The High Court ruled in Usdaw’s favour in 2022, but the supermarket, which raked in £2.3 billion in pre-tax profits last year, successfully appealed.
The legal battle was then taken to Britain’s highest court, and five judges ruled unanimously that Tesco would not be allowed to dismiss the staff.
Usdaw general secretary Paddy Lillis said: “We recognised that they had been afforded this payment because of their willingness to serve the business and it was on that basis that we agreed with Tesco that it should be a permanent right.
“When we said permanent, we meant just that. We were therefore appalled when Tesco threatened these individuals with fire and rehire to remove this benefit.”
He said the union was “delighted” with the outcome, which is a “win for the trade union movement as a whole.”
TUC general secretary Paul Nowak said: “Victorian-style employment practices like fire and rehire have no place in a modern economy.
“No company should force staff to reapply for their jobs on worse pay and conditions just to boost profits.”
A Tesco spokesperson said: “We accept the Supreme Court’s judgement.
“Our aim has always been to engage constructively with Usdaw and the small number of colleagues affected.”
