Let’s be honest the term “fire and rehire” rarely evokes a sense of optimism. It’s a phrase often wrapped in tension, used when organisations are grappling with change under challenging circumstances. Now, with the UK’s statutory Code of Practice in effect since July 2024, leaders have a clearer, more responsible path to follow when renegotiating employment terms. This isn’t just about legal compliance it’s a cultural shift. A call to rethink how we manage change while safeguarding trust, clarity, and fairness.
Understanding the Business Imperative Behind Change
There are moments in an organisation’s life when recalibration becomes necessary whether due to market pressures, cost management, or structural shifts. Sometimes, this recalibration affects people’s roles and conditions. Traditionally, if mutual agreement couldn’t be reached, employers might terminate existing contracts and offer revised ones. But this method blunt in execution often leaves lasting damage.
The new Code of Practice introduces a more human-centred framework. It encourages businesses to consult meaningfully, explore all avenues, and prioritise transparency. The result? A more respectful process that benefits both the business and its people.
What Does the Code Actually Require?
This isn’t about ticking boxes. The Code outlines a structured, thoughtful process placing communication, empathy, and accountability at the heart of employment term changes. Here’s how it plays out:
1. Begin with Meaningful Dialogue
Forget the corporate script. The Code calls for early, honest conversations. Employers are urged to share relevant information with employees or their representatives not as a formality, but as an invitation to collaborate. This is where trust begins.
2. Exhaust Every Reasonable Alternative
Dismissal should be the final note, not the opening line. The guidance presses organisations to consider creative alternatives including seeking early input from Acas before even contemplating re-engagement. Think in terms of redesign, not just reduction.
3. Be Open About the Why
Decisions made behind closed doors often unravel in public. The Code encourages employers to articulate the rationale behind proposed changes who is affected, why it’s necessary, and what alternatives were explored. Transparency, while sometimes uncomfortable, is essential for legitimacy.
4. Treat Feedback as a Resource, Not a Ritual
Employees, especially those on the front lines, often see solutions management may overlook. The Code elevates feedback from formality to strategy. Leaders must be prepared to listen and act on alternatives brought forward by their people.
Pause, Reflect, and Assess Before Acting
Let’s say you’ve consulted thoroughly, weighed up alternatives, and are still facing pushback. This is the moment for reflection. Can the same objectives be achieved with less disruption? What would be the long-term cost to morale, reputation, or legal standing of forcing through a change?
If you must proceed with dismissal and re-engagement, the Code recommends a thoughtful, structured approach:
- Provide Considerate Notice
Go beyond statutory minimums when possible. Advance notice is more than a courtesy it’s a demonstration of respect. - Support the Transition
When lives are being reshaped, practical support matters. Whether it’s childcare flexibility, relocation aid, or career coaching — the little things can soften the hardest changes. - Communicate with Compassion and Clarity
Final decisions should be shared clearly, respectfully, and backed with documentation. Keep lines of communication open to help mitigate anxiety and maintain continuity.
The Cost of Non-Compliance Isn’t Just Legal It’s Cultural
Failing to comply with the Code doesn’t simply increase the risk of tribunal action although compensation awards may rise or fall by up to 25% based on compliance. It also risks fraying the organisational fabric. How you handle moments of tension shapes your employer brand, your leadership credibility, and your people’s willingness to stay and grow.
Forward Thinking: A Checklist for Ethical Change Leadership
To navigate these changes with conviction and care, consider these proactive measures:
- Upskill Your Managers
They are the messengers and mediators. Equip them with both legal literacy and emotional intelligence. - Audit Your Policies
Align internal procedures with the spirit and substance of the Code. Contractual changes should never feel sudden or imposed. - Track the Journey
From initial consultation to final decision, document everything. Transparency and traceability are your strongest allies if called to account.
A Moment to Redefine What Change Leadership Looks Like
The introduction of the Code isn’t merely regulatory it’s cultural. It calls upon leaders to move from reactive tactics to proactive dialogue. Yes, change will still bring friction. But with the right intent and structure, it can also build trust, signal integrity, and shape workplaces that don’t just survive disruption they emerge stronger.
By embedding the principles of the Code into our leadership fabric, we move closer to the kind of organisations people want to be part of resilient, people-first, and future-ready.
