As employment solicitor Tony Bertin explains, the upcoming Employment Bill isn’t just about big businesses - it has something important for all employers to consider. While it’s easy to think this new legislation targets only large companies, the reality is that these provisions could impact organisations of any size. Whether you’re managing a small team or overseeing a large workforce, getting to grips with these changes now will put you in a stronger position when they take effect in October 2026.

A Response to P&O Ferries and the "Hire and Rehire" Ban

The new Employment Bill was largely shaped by the widely publicised actions of P&O Ferries in 2022, where staff were pressured to accept new terms or face dismissal. This incident raised significant concerns throughout the industry, prompting the government to step in and introduce provisions to prevent similar practices.

Under this bill, "hire and rehire" practices will be prohibited in almost all cases, and any dismissal on this basis will automatically be deemed unfair. Notably, employees won’t need to meet a qualifying period to make a claim. Once the bill is in force, employers who attempt “hire and rehire” risk facing serious legal repercussions. For those in HR or managing employment contracts, understanding these changes now is essential for developing a compliant approach to workforce management.

TUPE and Employment Contract Harmonisation - Challenges for Employers

A key concern with the new bill is how it impacts the Transfer of Undertakings (Protection of Employment) (TUPE) regulations, particularly when it comes to harmonising the terms and conditions of employees transferring from one employer to another.

Can Employers Harmonise Employee Benefits?

In theory, harmonising terms upwards is always possible - most employees won’t refuse an increase in pay or benefits. However, difficulties arise when an employer attempts to make downward adjustments in employee conditions. This is especially relevant for employers in sectors like outsourced cleaning or catering, who often gain new staff through contract transitions and will face compliance challenges.

For example, if you’re taking on an outsourced contract, like catering, a thorough understanding of the benefits provided by the outgoing employer - such as Permanent Health Insurance (PHI) or death-in-service coverage - can make all the difference between a seamless transition and potential legal issues.

What Happens When Benefits Don’t Transfer?

Imagine an employer pitches for a contract that includes PHI or death-in-service benefits. Large employers commonly provide these benefits, often including "previous risks accepted" clauses from insurers, meaning that transferring employees are automatically covered. If, however, the new employer cannot offer equivalent benefits, this could effectively be a termination of employment, triggering unfair dismissal claims under the new legislation.



Case Studies of TUPE and the New Employment Bill

To demonstrate the effects of these changes in practice, consider the following scenarios:

Accounting Firms and TUPE Transfers

A mid-sized accounting firm might consider taking on a client’s department as part of a TUPE transfer. Without carefully reviewing the existing employee benefits, the new employer risks inadvertently reducing the rights of transferred employees. If a transferee discovers that their previous sick leave or death-in-service benefits no longer apply, they may have grounds to bring a claim under the new protections for unfair dismissal.

Solicitors and Financial Institutions

Solicitors who take on outsourced legal work from large financial institutions must also tread carefully. Many financial institutions offer comprehensive benefits that can be challenging for new employers to replicate. If an employee suffering from a terminal illness loses valuable sick leave or death-in-service benefits following a transfer, it could lead to distress and, potentially, legal claims.

Conducting Due Diligence to Avoid Legal Complications

Since “hire and rehire” is no longer a viable last resort, employers must conduct deep due diligence in any TUPE scenario. This approach not only reduces risk but also helps to ensure a fair transition for incoming employees. The Employment Bill’s focus on employee protection makes it essential for employers to thoroughly understand their obligations and benefits when dealing with TUPE cases.

Preparing for the Employment Bill: Key Takeaways for Employers

To stay prepared, employers should consider the following:

1. Review current employment policies to ensure they align with the new provisions.
2. Conduct comprehensive due diligence when taking on new contracts, especially those involving TUPE transfers.
3. Work closely with employment solicitors to fully understand the implications of existing benefits on incoming employees.
4. Equip HR teams to identify and manage potential risks associated with the new “hire and rehire” restrictions.

Specialist Advice for Employers from Woodstock Legal Services

If you’re handling TUPE transfers, harmonising employment contracts, or want to ensure your business remains compliant, Tony Bertin is here to support you.

Contact him at t.bertin@woodstocklegalservices.co.uk or complete the form below.