Fire and rehire: expenses, benefits and shift pattern rules confirmed for March 2027
The government has published its response on restricted variations under the Employment Rights Act 2025. Most expenses and benefits in kind will be excluded, while changes between day and night or weekday and weekend working will be protected.
What changed
Once commenced, the Employment Rights Act 2025 will make it an automatic unfair dismissal where an employee is dismissed or replaced in order to make changes to core terms in their contract, protected as restricted variations.
Following the consultation, which received 121 responses, the government will introduce regulations to exclude expenses and benefits in kind from the scope of restricted variations, except for certain travel and accommodation expenses and benefits.
The regulations will also bring changes to shift patterns between day and night working, and between weekday and weekend working, within the scope of restricted variations.
The government intends to legislate when parliamentary time allows, aiming to bring the regulations into force alongside the Act's fire and rehire protections in March 2027.
HRjoy’s view
This narrows the protected terms in a useful way for employers: most expenses and benefits stay flexible, but moving people between day and night or weekday and weekend shifts will need agreement. Employers with rotas that change often should map those changes now. The regulations still need Parliament's approval, so the detail may change.
Source
General information for employers in Great Britain, not legal advice.
What to do
- List any planned changes to travel or accommodation expenses and benefits, or moves between day and night or weekday and weekend working, that you might need employees to accept.
- Plan to agree those changes by consultation and agreement rather than dismissal and re-engagement.
- Check whether other expenses and benefits you provide could still be changed if operational needs change, once the regulations are made.
Related answers
- What are the new rules on fire and rehire? From March 2027 (expected, subject to Parliament), dismissing an employee for refusing a change to core terms such as pay, hours, pensions, leave or certain shift patterns will be automatically unfair, unless the employer meets a narrow financial difficulties exemption. Dismissing employees to replace them with non-employees doing substantially the same work will also be automatically unfair in most cases.
- What is changing under the Employment Rights Act 2025, and when? The Employment Rights Act 2025 is being brought in by phases. Day-one paternity and parental leave, sick pay changes and six-month tribunal time limits already apply. Next come the stronger harassment duties on 30 October 2026, a six-month unfair dismissal qualifying period from 1 January 2027 and fire and rehire protections in March 2027. Future dates remain subject to Parliament.
- What are the rules on redundancy consultation? Employers should consult every affected employee before deciding on redundancies. If 20 or more redundancies are proposed at one establishment within 90 days, collective consultation with representatives must begin at least 30 days (45 days for 100 or more) before the first dismissal, and form HR1 must be submitted. Failure can lead to a protective award of up to 180 days' pay per employee.