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Case details

Tesco Stores Ltd (Respondent) v Union of Shop, Distributive and Allied Workers and others (Appellants)

Case ID: 2022/0133

Case summary


Was the CA wrong to find that Tesco was entitled to terminate certain employment contracts which included an entitlement to "Retained Pay", described as "permanent", and offer re-engagement on terms without Retained Pay (the so-called "fire and re-hire" mechanism)?


In 2007, Tesco Stores Limited ("Tesco") planned to open new distribution centres and close others. To retain staff, it offered a significant enhancement to the pay of staff willing to relocate from its Lichfield centre to its Daventry centre. This pay is referred to as "Retained Pay". By incorporation of a collective agreement, the Retained Pay was described as "permanent" and, by the terms of the agreements, was stated as only changeable by mutual consent.

In January 2021, Tesco wished to bring Retained Pay to an end. It therefore gave notice to the relevant staff that it intended to seek their agreement to remove Retained Pay from their contracts in exchange for a payment. If an employee did not agree to this change, their employment contract would be terminated and they would be offered re-engagement on different terms ("fire and rehire").

The individual appellants are employees who have refused to give up their Retained Pay. They brought a claim in the High Court, seeking a declaration that their employment contracts granted an entitlement to Retained Pay, that they were subject to an implied term that Tesco could not terminate the contracts for the purposes of removing Retained Pay and an injunction preventing Tesco from terminating the contracts. The appellants were successful in the High Court, but the appeal was allowed in the Court of Appeal. The appellants now appeal to the Supreme Court.

Judgment appealed

[2022] EWCA Civ 978



(1) Union of Shop
Distributive and Allied Workers
(2) Christopher Webb
(3) Jagpreet Singh
(4) Sandeep Kumar


Tesco Stores Ltd



Lord Reed, Lord Lloyd-Jones, Lord Leggatt, Lord Burrows, Lady Simler

Hearing start date

23 April 2024

Hearing finish date

24 April 2024

Watch hearing
23 April 2024 Morning session Afternoon session
24 April 2024 Morning session