Tesco’s attempt to overturn a legal decision regarding employee contracts has been unsuccessful in the Supreme Court, marking a significant ruling for employment rights.
- The judgement prevents Tesco from terminating employee contracts to avoid honoring ‘retained pay’ commitments made under a 2007 agreement.
- This case involved the Usdaw union and affected employees in Tesco’s Daventry and Lichfield distribution centers.
- The court’s decision supports prior rulings from the High Court and reinforces workers’ rights against exploitative employment tactics.
- Tesco acknowledges the ruling, emphasizing a commitment to fairness within its workforce.
In a landmark decision, the Supreme Court has ruled against Tesco in its appeal regarding the termination of employment contracts for the purpose of removing ‘retained pay’. This decision upholds a previous High Court ruling and concludes a prolonged legal confrontation between Tesco and the Usdaw union.
The conflict traces back to 2007 when Tesco introduced a ‘retained pay’ enhancement. This was a part of a collective agreement with Usdaw, aimed at incentivizing employees to relocate to new distribution centers in Daventry and Lichfield. The dispute arose when Tesco sought to phase out this employment benefit, leading to allegations that the company attempted to dismiss and rehire workers under less favorable terms.
Employees, backed by Usdaw, secured an injunction from the High Court against Tesco’s actions, which the retailer challenged in higher courts. However, the Supreme Court’s ruling affirmed the High Court’s position, preventing Tesco from employing such strategies to alter existing contracts unilaterally.
Usdaw general secretary, Paddy Lillis, expressed satisfaction with the outcome, describing it as a triumph for the trade union movement and a stand against coercive employment practices. He highlighted that the tactics employed by Tesco were unacceptable within industrial relations, necessitating legal intervention to protect affected workers.
Tesco, in response, has accepted the judgment without dispute. A spokesperson articulated the company’s intent to treat its distribution center employees fairly, acknowledging their instrumental role in operations. The representative clarified that the ‘retained pay’ was originally introduced to retain specific staff, and its gradual removal was part of a broader effort to ensure fairness across the workforce.
The Supreme Court’s ruling underscores the judiciary’s role in safeguarding employment rights against unilateral contract alterations by employers.
