Tesco was not entitled to terminate some employees' contracts and offer to rehire them on less favourable terms, the Supreme Court ruled on Thursday.
Shopworkers' union Usdaw took legal action against Britain's biggest retailer after Tesco sought to remove some warehouse workers' entitlement to increased pay by ending their contracts and offering to re-engage them – a practice often referred to as 'fire and rehire'.
The governing Labour Party has said it will outlaw "fire and rehire" tactics, but has yet to set out how it will replace current codes of practice.
A spokesperson for the Department for Business and Trade said: “We will be bringing forward legislation soon to put an end to unscrupulous fire and rehire practices, which have no place in a modern labour market.”
The Supreme Court ruled that Tesco was not permitted to use 'fire and rehire' in these circumstances and restored an injunction preventing the retailer from doing so.
Usdaw had won an injunction in February 2022 which prevented Tesco from dismissing the warehouse workers and offering them new contracts, but Tesco subsequently overturned that ruling on appeal.
The Supreme Court reversed that decision, however, ruling that Tesco's right to terminate employees' contracts could not be used to deprive them of their right to enhanced pay.
Tesco, which has a British grocery market share of nearly 28 per cent, said it accepted the ruling. A spokesperson said it related to “a very small number of colleagues in our UK distribution network who receive a supplement to their pay”.
“Our objective in this has always been to ensure fairness across all our distribution centre colleagues,” the spokesperson added.
Paddy Lillis, Usdaw general secretary, said in a statement that the ruling was “a win for the trade union movement as a whole”.
Lillis said of "fire and rehire" itself: “These sorts of tactics have no place in industrial relations, so we felt we had to act to protect those concerned.”
Usdaw brought the case on behalf of 42 workers employed at Tesco’s Daventry and Lichfield distribution centres after the supermarket giant tried to cut their wages as part of a change to their terms and conditions of employment.
The dispute centred on the workers' entitlement to enhanced pay for agreeing to move to a new distribution centre back in 2007.
When Tesco sought to remove the entitlement in 2021, it asked workers to agree to its removal for a lump sum payment or else their contract would be terminated and a new contract offered without the increased pay included.
In its ruling in favour of the workers, the High Court had noted that the workers had been guaranteed an entitlement to a specific payment labelled ‘retained pay’ to keep them within the business, which Tesco intended to remove by firing and then rehiring them.
The judge held that there was an implied term in the workers’ contracts that the right to terminate employment could not be exercised if the aim was to remove a right to ‘retained pay’.
The union's lawyer, Oliver Segal, said in court documents for the appeal in April that led to Thursday's ruling that Tesco was effectively arguing it has an "unrestricted freedom to terminate the relationship 'at will'."
Tesco, however, argued the affected workers had received increased pay worth thousands of pounds each for more than a decade.
October saw shop prices fall marginally further into deflation for the third consecutive month with food inflation eased, particularly for meat, fish and tea along with chocolate and sweets as retailers treated customers to spooky season deals, shows industry data released today (29).
According to British Retail Consortium (BRC), shop price deflation was at 0.8 per cent in October, down from deflation of 0.6 per cent in the previous month. This is below the 3-month average rate of -0.6 per cent. Shop price annual growth was at its lowest rate since August 2021.
Food inflation slowed to 1.9 per cent in October, down from 2.3% in September. This is above the 3-month average rate of 2.1 per cent . The annual rate continues to ease in this category and inflation remained at its lowest rate since November 2021.
Fresh Food inflation decelerated in October, to 1.0 per cent , down from 1.5 per cent in September. This is below the 3-month average rate of 1.2 per cent . Inflation was its lowest since October 2021.
Ambient Food inflation decelerated to 3.1 per cent in October, down from 3.3 per cent in September. This is below the 3-month average rate of 3.3 per cent and remained at its lowest since March 2022.
Helen Dickinson OBE, Chief Executive of the BRC, said, “October saw shop prices fall marginally further into deflation for the third consecutive month. Food inflation eased, particularly for meat, fish and tea as well as chocolate and sweets as retailers treated customers to spooky season deals. In non-food, discounting meant prices fell for electricals such as mobile phones, and DIY as retailers capitalised on the recent pick-up in the housing market.
“With fashion sales finally turning a corner this Autumn, prices edged up slightly for the first time since January as retailers started to unwind the heavy discounting seen over the past year.”
“Households will welcome the continued easing of price inflation, but this downward trajectory is vulnerable to ongoing geopolitical tensions, the impact of climate change on food supplies, and costs from planned and trailed Government regulation. Retail is already paying more than its fair share of taxes compared to other industries.
“The Chancellor using tomorrow’s Budget to introduce a Retail Rates Corrector, a 20 per cent downwards adjustment, to the business rates bills of all retail properties will allow retailers to continue to offer the best possible prices to customers while also opening shops, protecting jobs and unlocking investment.”
Mike Watkins, Head of Retailer and Business Insight, NielsenIQ, said, “Inflation in the food supply chain continues to ease and this helped slow the upward pressure of shop price inflation in October, however other cost pressures remain.
“Consumers remain uncertain about when and where to spend and with Christmas promotions now kicking in, competition for discretionary spend will intensify in both food and non-food retailing.”
PayPoint has announced a new partnership with Leeds Credit Union (‘LCU’), a financial cooperative with 37,000 members, enabling them access to its CashOut service, effective immediately.
The partnership will mean that LCU customers can access their cash and savings across any of PayPoint’s UK network of 29,000 retailer partners. This represents an unprecedented growth in accessibility and the first partnership of its kind for LCU. Historically customers have needed to visit one of LCU’s four branches to withdraw money.
Leeds Credit Union provides straightforward, affordable financial services. As a mutual there are no shareholders, so it is owned by its members and always has the interests of the members at the heart of everything it does. The credit union prides itself on providing members with the most appropriate services based on their circumstances.
“Our partnership with Leeds Credit Union will enable its customers to access their funds more easily than ever before," said Jo Toolan, Managing Director of Payments at PayPoint. "We’re committed to pursuing these kinds of partnerships, which enable credit unions to offer a more competitive and technologically advanced service, while simultaneously making the lives of customers that little bit easier through enhanced access.”
Greg Potter, Head of Marketing & Member Experience at Leeds Credit Union, said: “Increasingly, we’re looking at ways that we can apply technological solutions and partnerships to add value to the experience of our members using Leeds Credit Union. This partnership is demonstrative of our determination to grow in their best interests and will make access to funds something that can be done at any of a number of PayPoint locations in the UK.”
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A Philip Morris logo is pictured on a factory in Serrieres near Neuchatel, Switzerland December 8, 2017. REUTERS/Denis Balibouse/File Photo
Marlboro-maker Philip Morris said Tuesday it planned to close down its two production sites in Germany, citing falling demand for cigarettes among Europeans.
"In recent years, demand for cigarettes in Europe has fallen significantly," the company said in a statement, adding that it saw the same trend for roll-your-own tobacco.
"This trend is expected to continue in the coming years," the company said.
Many smokers have been shifting to e-cigarettes, or vapes, and heated-tobacco devices.
Philip Morris employs 372 workers at its factories in Berlin and Dresden. Both sites are scheduled for closure next year.
The tobacco giant said it would begin discussions with labour representatives to find "fair and socially responsible solutions" for staff.
Nisa retailer Prem Uthayakumaran has made significant donations totalling £3,500 to two local community organisations through Nisa’s Making a Difference Locally (MADL) charity.
The funds will provide essential support to groups within the communities that his stores serve, helping them continue their invaluable work.
The first of these generous donations was a £1,000 contribution from Broxbourne Service Station in Hertfordshire, directed to the Lea Valley Karate Academy. The funds will enable the academy to purchase much-needed equipment, ensuring that young people and adults in the local area have access to high-quality resources as they develop their skills in martial arts.
Additionally, a £2,500 donation was made by Eastfield and Cross Road Service Stations to the Mansfield Town Ability Counts Football Club. The club, which provides opportunities for individuals with disabilities to participate in football, will use the funds to support their programs, enhancing the experience for current players and making it possible for even more participants to join.
In July 2024, Prem donated £1,000 to Voice of the Vale – a group of young performers at Nottingham Trent University. This followed further self-donations from Prem to Broxbourne Organisation for Disabled and to Mansfield Under 12s Football Club in 2023.
Prem Uthayakumaran said: “Supporting the communities around my stores has always been important to me, and through Nisa’s Making a Difference Locally charity, we’re able to make a real, tangible difference. The Lea Valley Karate Academy and Mansfield Town Ability Counts Football Club both play vital roles in their respective communities, and I’m thrilled to be able to contribute to their success.”
Nisa’s Making a Difference Locally charity enables retailers to donate to local good causes through the sale of Co-op own brand products in their stores. A percentage of sales from these products goes into a MADL fund, which retailers can then use to make donations to charities, schools, sports clubs, and other community groups.Kate Carroll, Head of Charity at Nisa, said, “We are delighted to see retailers like Prem using their MADL funds to support such worthwhile local causes. Both the Lea Valley Karate Academy and Mansfield Town Ability Counts Football Club provide vital services to their communities, and donations like these enable them to continue their important work. At Nisa, we are incredibly proud of our retailers’ commitment to making a difference locally.”
Nisa’s Making a Difference Locally charity has been helping retailers like Prem Uthayakumaran give back to their communities for over 15 years, and with each donation, they help foster stronger, more Connected local areas.
High streets in the UK are collectively pay one third of all business rates while accounting for 9 per cent of the economy, British Retail Consortium (BRC) stated on Thursday (24), strengthening its call for a fairer level of business rates for hospitality and retail.
BRC and UKHospitalityare united in their call for the Chancellor to implement a fairer level of business rates for hospitality and retail at the Budget, which will rebalance a system that unfairly punishes our high streets and town centres. This was a manifesto pledge from Labour ahead of the election.
A lower rate for hospitality and retail, which together employ around six million people, would unlock investment in our high streets, while also stemming the loss of shops, pubs, restaurants and hotels, and the jobs that rely on them.
In 2023-24, retail and hospitality businesses combined to pay almost £9 billion in business rates, 34 per cent of the overall rates bill, while accounting for only 9 per cent of the overall economy.
Current business rates relief for retail and hospitality is set to end on 31 March, costing the sectors a combined £2.5bn. That would take their bill up to £11bn, accounting for 44 per cent of total rates.
Helen Dickinson, Chief Executive of the British Retail Consortium, said, "Consumers want diverse and thriving high streets, but this is held back by the broken business rates system. It is the biggest barrier to local investment and prevents the creation of new shops and jobs.
"Already, the industry pays far more than its fair share – retail accounts for 5 per cent of the economy, but pays 7.4 per cent of all business taxes, and over 20 per cent of all business rates. The Budget is a great opportunity to right this imbalance, ensuring that retail pays a fairer level of business rates."
Kate Nicholls, Chief Executive of UKHospitality, said, "Hospitality is at the heart of our communities but the enormous value it delivers both socially and economically is under threat from the inflated business rates bill the sector has to foot.
"High street businesses paying one third of all business rates is absurd and one of the primary reasons why we see our businesses facing financial challenges – it makes running a pub, bar, café or restaurant, to name a few, incredibly expensive.
"Introducing a reduced level of business rates for the high street at the Budget can unlock millions in investment – from new venues to more jobs. Crucially, it would save our high street from countless closures if hospitality had to bear a billion pound business rates hike in April."