O’Shea: Law needs to be clarified around ‘fire and rehire’ notices

More clarity is needed from the law over when employers should issue fire and rehire notices to their employees, Centrica chief executive Chris O’Shea has said.

The comments came as part of the ongoing dispute between the British Gas owner and the GMB Union over the former’s plans to reissue contracts to some of its employees as part of its major restructure.

Centrica issued HR1 and S.188 notices in July last year which allow it, in a “last resort”, to terminate workers’ contracts and issue new ones with updated terms and conditions.

Giving evidence to the Business, Energy and Industrial Strategy Committee this morning (2 February), O’Shea said he “regretted” the company’s interpretation of the law which is that S.188 notices have to be issued as soon as the employer believes there is no possibility of a negotiated settlement.

He said: “I don’t think the way the law is drafted just now helps with negotiations. I understand why Mr Bowden and the GMB feel that that contaminates negotiates. I would feel similar to that. But I think what we can’t have is companies not being able to make changes to terms and conditions at all, but we can and I hope we do change where in the process that has to be notified because I don’t think the law as it’s currently drafted helps us in these conversations.”

When asked why he did not think there would be a negotiated settlement, O’Shea responded that after the first meetings the company had with trade unions in July last year, a joint statement was issued by GMB and Unison which said the unions would not accept the terms.

In response, GMB national officer Justin Bowden said he had never been involved in a situation where a company threatened to fire and rehire employees if they did not agree to new terms before formal negotiations had begun.

He accused Centrica of having “poisoned the well” and of creating a situation of conflict from the beginning.

O’Shea added that he hopes a clarification could be made as to the timing of when a S.188 notice can be issued and said he would be happy for Centrica’s lawyers to meet and exchange legal advice with the lawyers of GMB to help reach a common view.

The dispute has been ongoing for several months and has resulted in strike action, with more strikes planned on 5, 6, 7 and 8 February.

During the hearing, O’Shea also said police were investigating after his wife and teenage son had been the recipients of excrement sent to them with a note referring to the fire and rehire proposals.

He added: “Only yesterday, my wife and teenage son had a package of excrement delivered to them with a note about fire and rehire. This is something that affects absolutely everybody. I am not immune to this.”