The statutory Code of Practice on Dismissal and Re-engagement came into force on 18th July. There is no stand-alone claim for breach of its provisions, but it must be taken into account by employment tribunals in relevant cases including unfair dismissal.
The Code enables tribunals to uplift compensation by up to 25% if an employer unreasonably fails to follow it.
The draft Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment of Schedule A2) Order, which would have contained the power for tribunals to apply an uplift or reduction in compensation in collective consultation claims where a party failed to follow the Code was also expected to come into force on 18 July, but did not gain House of Lords' approval before the general election.
The Code provides that "fire and rehire" should only be used as a last resort and that alternatives should be explored by employers. The Code introduces a requirement to consult for as long as reasonably practicable, and states that employers should contact Acas at an early stage before they raise "fire and rehire" with the workforce. Threats of dismissal should not be used to coerce employees into signing new terms and conditions.
It's worth noting that Labour have committed to bringing forward legislation within the first 100 days of its government to outlaw "fire and rehire". Although the Secretary of State for Business and Trade, has decided not to prevent the current Code from coming into force (on the basis that it provides at least a small additional level of protection for workers) the government will replace the Code with a strengthened version as soon as it has brought forward the new legislation.
