Firing and rehiring in Street. Why Johnson’s high-flown, high wage economy is for the birds

In comments that were crass even by his own low standards, Boris Johnson recently told an interviewer that falling health outcomes didn’t matter because wages were going up. His statement, “never mind life expectancy, never mind cancer outcomes – look at wage growth” has been widely condemned as callous and indifferent to the suffering of thousands of people with life-threatening conditions. Moreover, it just isn’t true for very many people.

One group for whom it is most definitely not true is the workers at Clarks Distribution Centre in Street, Somerset. They are faced with the prospect of being sacked and then re-employed on lower wages and worse conditions – victims of the newly fashionable employer tactic of ‘fire and rehire’. Instead of earning an average of £11.16 per hour workers will be paid £9.50. Instead of sick pay provisions that allow 13 weeks on full pay they will get 6 weeks’ full, and 6 weeks’ half pay. Sick pay for the first day of absence will be abolished.

Far from wage growth, many of these workers have not seen a pay rise for four years and now face a cut. It’s no surprise that they are on strike.

Why has this happened? Clarks was one of a number of Quaker-owned businesses that showed it was possible to be commercially successful while offering decent pay and conditions to its workforce. Clarks, like other enlightened employers, invested in its local community. In former times it provided housing for its workers, a school, a library and a swimming pool. Those days are long gone.

In March 2021 Clarks became owned by Lion Rock Capital, a Hong Kong-based private equity company. The Chinese owners don’t appear to have heard of Boris Johnson’s dream of a high skill, high wage economy. Their business model appears to be to cut costs and slash the wage bill. Local workers are paying the price.

It is not just the Chinese, however. ‘Fire and rehire’ has been in the news this year because of a number of high-profile cases. In May British Gas dismissed hundreds of its engineers and offered to take them back on worse conditions. British Airways, Weetabix and Asda are among other household names using this tactic to cut pay. According to the TUC, since the start of the pandemic almost one in ten workers have been threatened with the sack by their employers in an attempt to impose inferior pay and conditions.

Although the practice is not illegal a large majority of people feel it should be outlawed. Even Boris Johnson has said that he thinks it is unacceptable, though whether he means it is anyone’s guess. Somerset MP Jacob Rees-Mogg has also spoken out and is reported as saying “Employers threatening to fire and rehire as a negotiating tactic are doing something that is wrong and decent employers do not do. Companies should know better than to behave in this way.” Despite their fine words there is no evidence that either he, or his leader, is planning to do anything about it.

One thing they could have done was to endorse the Private Members’ Bill introduced by Barry Gardiner MP in July 2021. Although it won support from members of all parties it could not change the law without government backing. Instead of action to match their rhetoric however, all ministers offered was to look at renewed guidance. As Gardiner says,

“the companies who are doing this don’t need more guidelines, they know what they are doing is wrong and they will keep on doing it unless someone stops them.”

The disconnect between the fantasies of ministers and the reality of ordinary people’s lives is truly staggering. According to Johnson “the direction in which the country is going now [is] towards a high-wage, high-skilled, high-productivity and, yes, thereby a low-tax economy.” Tell that to the people on the picket line in Street.

Editor: We were sent this by the Union as part of a press release:

Hear the testimony of someone who has worked for Clarks for 34 years:

“I have been a 100 per cent loyal employee of Clarks for 34 years, never taking a day off sick until 5 weeks ago when I collapsed at work. I am now signed off for work-related stress because the situation has become too much for me; and I am not the only one. Everyone in Westway Warehouse whose job is at risk feels exactly the same – there are some colleagues that may potentially lose their homes as a result of this company’s actions. Fire/Rehire is a terrible thing to do. Breaking our contracts is a disgrace and they should be ashamed; cutting our pay is not going to save this business. We have been told we are paying for the past mistakes of our current bosses’ predecessor – if that is the case then maybe HE should take the pay cut?

All we are guilty of is doing the best job that we could for the last 20 years. We have endured one incompetent boss after another and that is as a consequence of the Clarks family’s poor management – AND WHERE ARE THEY NOW? I feel the family have turned their backs on us and I would very much like to remind them that going back to the 80’s, 90’s and 00’s, when this great company was making several millions, we were there getting the product out to the customer. I think the family have forgotten how loyal we were, and still could be if given an unprejudiced chance. We have not been awarded a pay rise or cost of living rise in over 5 years when household bills have continued to climb – energy, food, council tax, national insurance…in fact everything, yet this company wants to cut our pay by 15% stating that the only time we will receive a pay rise is when minimum wage catches up (which will be next year).

An idea was put forward by us of everyone in the company, from the CEO down, taking a 1% pay cut this year – that would make more of a difference. They originally wanted to cut our pay by 25 per cent this year then changed to 15 per cent – what nice people!

Back in July we had a video meeting with the boss of distribution for the company. I explained about my 34 years of service and he responded that he “does not give a damn about my loyal service and nor does Clarks”.

When I am not working, I am a carer for my 87-year-old dad – I don’t need or deserve this, and neither do my colleagues.

A few days before I collapsed, we were all summoned so that our boss could read out the new contract; he stated it’s a “sh*t deal, but it’s all we’re going to get” – how do you think that makes us all feel? This company is an absolute disgrace; Clarks say they “care” about my mental health issues but frankly that’s crap! They have mentally broken me; I don’t think I’ll ever be the same again.

I am asking that the Clarks family step in and stop the shameful actions THEIR company is implementing, show us the same allegiance we have shown them. Or are they willing to sit back and do nothing? I sincerely hope not …

I would like to thank Barry Gardiner, MP, for bringing in a bill to make the disgraceful practice of Fire and Rehire illegal. I hope it gets through even though it will be too late for us. Thanks, Barry for coming to Street and giving us your support.

Just a couple more things: if anyone from the media gets a chance to speak with a member of the Clarks family perhaps ask them if it’s OK for their senior personnel to inform a dedicated workforce that the deal they are being offered is sh*t. Do they consider that acceptable?

My colleagues and I have been told to make “lifestyle changes” – how do we “change” the necessity to provide food for our families and pay bills?

Lastly, none of us wanted to take strike action but we feel we have no choice; some of my colleagues will be fired within weeks if they don’t sign the deplorable contract. All we want is to be able to go back to doing the best job that we can, as we have always done.”