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ARTICLE · 15 MAY 2026

Outsourcing Spotlight – Spring / Summer 2026

Travers Smith LLP
Travers Smith LLP
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Travers Smith LLP

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UK fire and rehire reforms under the Employment Rights Act 2025 could unexpectedly impact outsourcing arrangements where service providers don't take on customer employees.

United KingdomEmployment and HR

In this issue, we look at whether UK fire and rehire reforms could affect outsourcing. We also discuss consumer-facing outsourcings, the impact of the Middle East crisis, cloud switching, the expansion of unfair dismissal rights, new EU rules affecting financial services outsourcings and UK rules affecting premises and event management outsourcings.

Could 'fire and rehire' reforms impact outsourcing?

Upcoming restrictions on 'fire and rehire' under the Employment Rights Act 2025 could have an impact on outsourcing arrangements.

What is 'fire and rehire' and why is it being restricted?

'Fire and rehire' is a practice sometimes used to change workers' terms and conditions of employment when workers do not agree to the changes. The employer terminates the existing employment contract and offers a new contract on revised terms. The practice has received widespread criticism in recent years, leading the Government to introduce reforms severely limiting its use from January 2027.

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