The importance of consulting and communicating with employees and their representatives before making any decisions cannot be underestimated. Notice period and termination of employment. It is mandatory to procure user consent prior to running these cookies on your website. Statutory or contractual notice period. There are two types of notice period: statutory and contractual. Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. The contract can include a probationary period and can allow for this period to be extended. To lawfully dismiss an employee you will need to establish one of five potentially fair reasons as set out under the Employment Rights Act (ERA) 1996, namely conduct, capability, redundancy, breach of a statutory restriction or “some other substantial reason” of a kind that justifies the dismissal. An employer can make a change ('variation') to an employment contract if: there's something in the contract that allows the change (usually called a 'flexibility clause') the employee agrees to the change; the employee's representatives agree to the change (for example, a trade union) Usually, the employer and employee both need to agree to any contract changes. In some instances, employees may even come up with new ideas and alternatives that you may be willing to try. This category only includes cookies that ensures basic functionalities and security features of the website. Statutory notice is the minimum legal notice that can be given. To help us improve GOV.UK, we’d like to know more about your visit today. Notice period fixed-term contracts. You should also only make these changes on reasonable notice. As set out above, this could either be through reliance on a contractual provision, through mutual or collective agreement, or even forcing through a reasonable change using a process of dismissal and rehire. If the notice period for the employee to end a contract of employment is extended, the notice period for the employer should be double the notice period of the employee. Tier 1 Investor Visa (Application Guidance), Approaching employees with your proposal for change, Providing a written statement of any contractual change, Pushing ahead with your proposals without agreement. You may also want to talk with workers, asking them about their future plans. ACAS Early Conciliation Form (Need Help? Even if you have the right to make changes to an employment contract, you may want to offer the employee something in return as a sweetener. The notice that you are required to give an employee to implement a change of contract will depend on the particular circumstances giving rise to the proposed change and the basis upon which the change is sought. We use cookies to collect information about how you use GOV.UK. Pay in lieu of notice (PILON) With a PILON clause, you can end the employment before your leaver serves their notice, but you must pay them for their full notice period. By mutual or collective agreement, ie; where the employee individually agrees to the change, or where an agreement is negotiated between you, as the employer, with a trade union or staff association. In particular, the absence of any explanation, discussion or consultation on the part of the employer can lead to disagreement and disharmony, and in extreme cases, irreparable damage to the employment relationship. In terms of the Basic Conditions of Employment Act, any party to an employment contract must give to the other written notice of termination as follows: One week, if employed for four weeks or less . Any "fundamental change" to an employment contract requires careful consideration by the employer. Depending on the nature of the change and when, in operational terms, you need this change to come into force, this could be as much as a “90 days notice change of contract” or even a change with immediate effect. If the employment agreement doesn’t have a notice period, then fair and reasonable notice must be given. ... employer wants to change the contract does not mean you have to accept the change. The second is to give working notice of the change and implement that change upon the conclusion of the notice period. There are various steps that you will need to take when looking to implement a change of contract. employment contract, see the JobWatch “Employment Contracts” infosheet. If any company want to change the notice period from one month to two or three months, it can do so but not for the existing employees but for new joinees only. By way of example, where you are looking to rely on a mobility clause within an employee’s contract of employment to relocate that individual to a different office or site, the nature of the move and extent of any inconvenience caused will determine what is reasonable notice in the circumstances. Employee notice periods are determined by the contract of employment and the law. Where a trade union is recognised, negotiations to change contract terms should be through collective bargaining. In the event that you try to force through a change of contract you may find yourself facing a whole host of practical and legal issues in consequence, not least the possibility of defending a tribunal claim. These are each dealt with in turn below. Approaching employees with your proposal for change But an employee can insist on a change if they have a legal right to it. As an employer, you can make a change or variation to an employment contract in the following circumstances: Accordingly, in the absence of any contractual provision giving you the right to change a specific term, in most cases you must obtain the agreement of your employee(s), or the agreement of any trade union or other representative, if you want to vary an employment contract on a lawful basis. If the terms and conditions of an employment contract need to be changed, both employers and employees should negotiate and try to reach an acceptable agreement, taking into consideration business needs … As such, to defeat any claim before the tribunal, you must be able to prove that you had a good business case for the change and followed a proper consultation process. Any one-to-one consultation with a dissenting employee will almost certainly bolster your defence to any subsequent unfair dismissal claim. Providing a written statement of any contractual change They say they want to do this to protect the business because it is difficult to find and train replacements within a month, especially for managers like myself because there are no “deputy” or assistant managers that can step into the role. The consequences of not doing so are expensive. My employer wants to change my contract so my notice period is 3 months instead of 1 month. Under the Worker Adjustment and Retraining Notification Act (“WARN Act”), employers must give 60 days’ advance notice to affected employees in advance of plant closings or cov… A contract of employment is a legal agreement between the employer and the employee. Small changes probably wouldn’t carry an expectation of incentive/compensation. This should take into account length of service, type of job, how long it might take to replace the employee and common practice in the workplace. Get the DM Business Newsletter & Invitations to our Events. When providing written notification, you should set out the precise nature of the change of contract and where to find further information about this, for example, in the staff handbook or on any HR intranet site. You can agree to a change in the length of the notice period. You can insist on a change if it’s covered by a statutory right - for example not working on a Sunday. Changing an employee’s contract of employment is not something you can usually do without their consent. Changing employees’ contractual terms requires careful handling and expertise. In the employment contract, you indicate whether a Collective Labour Agreement (CAO) applies. When an employee transfers there are some special protections and rules about the terms and conditions in their contract. You also have the option to opt-out of these cookies. The employment contract defines the employer-employee relationship, including the terms and conditions of employment. Most employees are employed “at-will” and either party can terminate the employment relationship without notice. All content is available under the Open Government Licence v3.0, except where otherwise stated, Coronavirus (COVID-19): guidance and support, Transparency and freedom of information releases, consult or negotiate with employees or their representatives (for example from a trade union or staff association), listen to alternative ideas from employees. The employer could, of course, make things like future salary increases conditional on signing the new contract (unless the existing contract specifies some sort of automatic increase each year, which is very unlikely!) In circumstances where you are planning to dismiss and rehire 20 or more employees within 90 days or less, you may have to follow the collective consultation process used for redundancy dismissals. Four weeks if employed for more than four weeks. As such, “dismissal and rehire” should only be used as a last resort, where all other options and alternative solutions have been completely exhausted. In these circumstances, it’s important employers consider getting legal advice before making a change. As Neil W. says, the employee can refuse to sign - a change to an employment contract has to be agreed by both parties just like a change to any other contract. The court would probably modify that portion of the contract to instead read the employee “may not work in the same field within 5 miles of the location of the current employment for a period of 12 months.” Employers should be careful if changing a contract of employment when there’s been a business transfer (TUPE). By way of example, where you are looking to rely on a mobility clause within an employee’s contr… No change in contract of employment which will make the employees feel uncomfortable can be made without giving the employees an opportunity to assess and evaluate the situation. Dismissal for refusing to agree to new contractual terms typically falls within “some other substantial reason” under the ERA 1996, provided there is a sound and legitimate business reason for the change. However, neither you or your employer can change your employment contract without each others' agreement. DavidsonMorris Ltd t/a DavidsonMorris Solicitors is a company Registered in England & Wales No. Courts are unlikely to force staff to work their notice period. In either case, however, this can be an extremely risky strategy that is highly likely to cause discord amongst your workforce, if not leaving you defending a claim for either breach of contract or unfair dismissal. DavidsonMorris are experienced employment law and HR specialists. For example, if an employment contract states that the employee “may not take work in the same field anywhere in the United States for a period of 20 years,” a judge may alter it. If there isn’t a notice period in the employment agreement. Pushing ahead with your proposals without agreement A fundamental change results where the terms of employment are changed in any significant way. In circumstances where you cannot agree a change of contract, it is often best to keep talking for as long as possible, making every effort to reach a compromise. To terminate their labour contract, employees must demonstrate their serious and unequivocal intent to do so.. Where agreement cannot be reached, as explained above, you may terminate an employees’ existing contract and offer continued employment on new terms. After the expiry of the legal notice period, the new employer must conclude an employment contract with the worker, through the digital certification service of the employment contracts. Examples of fundamental changes include, amongst others, a reduction of hours and salary, geographical relocation, or a significant change in the roles and We use this information to make the website work as well as possible and improve government services. Organisations typically ask employees who have been in their jobs for more than two years to work one month’s notice, via the employment contract. It is prudent for an employer to implement and update their employment contracts. A notice period of a month gives you a reasonable amount of breathing space to recruit a replacement employee. These cookies do not store any personal information. In other words, you can force the change on any dissenting employee(s). These cookies will be stored in your browser only with your consent. One of the most common problems when dealing with a proposed change of contract is a lack of communication between the parties. The minimum statutory notice period varies depending on the employee’s length of service. There is no notice period for fixed-term contracts. When should an employee receive a permanent contract? Probationary period. Needless to say, where you are asking an employee to work at a new location within reasonable driving distance of their home, you will not need to give them as much notice as when asking them to relocate to an entirely different region. With older employees this can include talking about their thoughts on retirement and their options for staying in the job, for example changes to their role, hours or working pattern. Equally, if you breach the employment contract, an employee might not need to work their notice period. In circumstances where an employee refuses to agree to any reasonable proposal for change, in theory, it is open to you to terminate their contract and re-employ them on new terms and conditions. By handling the matter carefully and sensitively, you are much more likely to secure the necessary agreement needed to allow you to lawfully effect any necessary change. Measures will be needed to manage the organisation’s exposure to legal risks and impact on employee relations as a result of varying contract provisions, however minor or positive you consider the changes to be. An employment contract must contain at least the following information: name / address of the employer and employee, work location, job title and description, start / end dates (open-ended in case of indefinite contracts), trial period (if any), hours of work, salary and other expenses, and a notice of termination clause for both parties. Don’t worry we won’t send you spam or share your email address with anyone. Further, any changes to collective agreements with a trade union or staff association must also be in writing. Employers should give the employee: one week's notice if the employee has been employed by the employer continuously for one month or more, but for less than two years If you have a question or need advice on any aspect of the contract variation, contact us. You should, however, inform your employee if you do not want to renew the contract. Forcing change without agreement can often lead to lower levels of engagement and performance in the workplace and/or employees working under protest, not to mention the risk of costly and time-consuming legal disputes. The latter ha… By having open, honest and meaningful discussions this should help you to build a better understanding of employee concerns and to consider all available alternative options. But opting out of some of these cookies may have an effect on your browsing experience. Changing Employment Contracts Any “fundamental change” to an employment contract requires careful consideration by the employer. Below we look at when a change of contract can be made and how this process should be handled, including any risks and common pitfalls involved, as well as the notice requirements necessary prior to any change taking place. 6183275 We have extensive expertise in employment documentation and contracts, including managing processes for change, giving full consideration to the required notice period for change and the importance of employee engagement and communication throughout the process. In relation to any claim for unfair or constructive dismissal, as with other dismissal claims, you must be able to show a fair reason for dismissal and that you acted reasonably in all the circumstances. If you seek to unilaterally change the terms and conditions under which an employee works, or unreasonably impose changes under a contractual provision such as a mobility clause, that individual may: In circumstances where the employee disagrees with the new terms and conditions but does not say or do anything, arguably this could be construed as their agreement to the change of contract. You’ve accepted all cookies. We would like to extend the notice period of several of our senior managers. Do we need their consent? Employers. What Reasonable Adjustments Can I Ask For? In particular, these types of contractual provisions should only be used to make reasonable contractual changes having regard to the individual circumstances of each employee. Working together to agree contractual changes in this way can not only help to prevent potential disagreements and disputes from arising, it can also often lead to a more harmonious working relationship moving forward. This can be accomplished in one of two ways, the first being to get employees’ consent and provide consideration for the change. We’ll send you a link to a feedback form. By submitting, you agree to our Privacy Policy. Minimum period of notice E+W+S 86 Rights of employer and employee to minimum notice. Further, even in cases where the contract of employment incorporates a flexibility or variation clause allowing, for example, changes to be made to an employees shift pattern or their place of work, you will not have an unfettered right to implement these changes in respect of all affected staff. Some contracts of employment contain a variation clause that can allow your employer to make changes to your contract. Having secured an agreement for a change of contract, you should provide a written statement of these changes to each affected employee. A fundamental change results where the terms of employment are changed in any significant way. Examples of fundamental changes include, amongst others, a reduction of hours and salary, geographical relocation, or a significant change in the roles and responsibilities of the employee. You can even consider this course of action in the absence of any express contractual basis to do so, although there must be some legitimate and sound business reason for the change, for example, where there are specific operational or economic circumstances requiring you to reorganise or relocate. You may even want to ask for volunteers where, for example, the change of contract might suit some employees more than others, or offer financial or other incentives, such as relocation costs or time off work where, for example, you are asking employees to change location. For an employee with continuous employment of 12 or more years, the notice period must not be less than 12 weeks. Further, the more employees you dismiss in this way, the greater your potential liability. ), There is provision within the contract that allows for the change, often referred to as a flexibility or variation clause, or. Except in certain mass dismissals or as provided for in an employment contract or a collective bargaining agreement, U.S. law does not impose a formal “notice period” to terminate an individual employment relationship. E+W+S (1) The notice required to be given by an employer to terminate the contract of employment of a person who has been continuously employed for one month or more— (a) is not less than one week’s notice if his period of continuous employment is less than two years, ), How to Write a Constructive Dismissal Resignation Letter, Employee or Worker (What Are Your Rights? You must also follow a fair procedure, including some form of consultation process and providing employees with the statutory minimum notice period prior to dismissal. Although not all changes of contract need to be set out in writing, you must give written notification within one month of any changes that relate to the employee’s main terms and conditions, such as working hours or job location. During the trial period, both employer and employee are allowed to terminate the employment contract with immediate effect. You should also set out when this change is to take effect, although ideally, an agreement should already have been reached as to the timing of any change. Its terms cannot lawfully be changed by the employer without agreement from the employee (either individually or through a recognised trade union). Prior to putting forward any proposed changes, you should always double-check the wording of any contractual provisions to see specifically what type of term you can vary, as well as whether you need to provide the employee with any minimum notice period and/or follow a certain procedure. Necessary cookies are absolutely essential for the website to function properly. The former is less risky, keeps employees happier and has a long legal history of being appropriate and permitted. The employee must comply with certain formal and notice-period requirements when resigning.. Who is concerned. You must get an employee’s agreement if you want to make changes to their contract. Regulated by the Solicitors Regulation Authority No. On the other hand, in circumstances where you are forcing through a change through dismissal and rehire, you will always need to provide the employee with the statutory minimum notice period for terminating their contract of employment. As such, where an employee is asked to relocate to a different region under the terms of a mobility clause requiring them to work anywhere in the UK, they should still be given sufficient notice to facilitate such a significant move. 542691 By following a consultation process you can also ascertain whether or not there are any objections and, if so, how these can be overcome. But an employee can insist on a change if they have a legal right to it. This website uses cookies to improve your experience. When consulting with employees, this should always be a two-way process where ideas are shared and worked on together. It will take only 2 minutes to fill in. Consult or negotiate with employees and/or their representatives, Fully explain your reasons behind making the change, Invite employees to share their concerns and suggest alternative ideas, Listen to employees concerns and consider all their ideas, Elect to work under the new terms, albeit only doing so under protest and treating the change as a breach of contract, Take a case to a tribunal for breach of contract, unfair dismissal, or even. As set out above, this could either be through reliance on a contractual provision, through mutual or collective agreement, or even forcing through a reasonable change using a process of dismissal and rehire. Employers cannot make changes without the employee’s consent. In particular, when approaching employees with your proposals for change, you should always follow these five basic steps: You may also want to talk with individuals on a one-to-one basis with a view to identifying the reasons why an employee is reluctant to accept any change, exploring different ways in which you may be able to address their individual concerns. Talking to your staff at the earliest possible opportunity, and prior to any final decisions being made, can help to facilitate a contractual change that meets the needs of both your business and your workforce. You can use the consultation process to explain your business case, answer employee concerns and consider your options. Employers should only use these clauses to vary a contract if they have a good reason, for example the business is struggling financially and needs to cut staff hours. Similarly, legal disputes can also arise as a result of any unreasonable enforcement of a flexibility clause. However, if she remains in the employ of the company, the company will be entitled to impose the changes once the notice period has passed. The contract ends on a fixed date. When an employer wants to change the notice period. Further, even where the employment contract contains some form of flexibility or variation clause, you can only make use of this type of contractual provision where it is reasonable to do so and having provided the employee with sufficient notice. How employment contracts can be ... contract that give employers the right to change some conditions of employment, ... on an employee moving to another country to work with 1 week’s notice. This website uses cookies to improve your experience while you navigate through the website. We also use third-party cookies that help us analyze and understand how you use this website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. Practical, up to date guidance on the employment, HR & immigration issues of the coronavirus outbreak. The notice that you are required to give an employee to implement a change of contract will depend on the particular circumstances giving rise to the proposed change and the basis upon which the change is sought. All employees have the right to resign, that is, to terminate their employment contract at their own initiative. Registered Office: Level 30, The Leadenhall Building, 122 Leadenhall Street, London, EC3V 4AB, Branding, Digital & Website by Rokman Laing. The Unfair Dismissals Acts 1997–2015 will not apply if you are dismissed at an early stage in your employment while you are on probation or undergoing training, provided that: The contract of employment is in writing When looking to make a change to an employee’s contract of employment you should not only approach the matter having regard to the economic and operational needs of your business, but at all times having regard to the individual needs of each employee affected by the change. In Lancia v.Park Dentistry, the Ontario Superior Court confirmed that employers can change the fundamental terms of an employee’s employment, without providing consideration, so long as they take appropriate steps to provide reasonable notice of the change coupled with notice that employment under current terms would terminate at the end of that notice period. An employee must receive a permanent contract after 3 consecutive temporary contracts, or after temporary contracts over a period of 3 years. That said, pushing ahead with any proposed change in the hope an employee will bow to pressure and keep quiet about it, is likely to leave you exposed to very costly litigation, not to mention serious criticism from the tribunal. What legal rights do we have if they are not happy for us to change their employment contract? It’s often seen as a respectful approach – depending on how significant the change might be. Employees: whose employment contract is a: The notice period for the employee is usually one month. You can change your cookie settings at any time. Don’t include personal or financial information like your National Insurance number or credit card details. Once an employee has been notified of the future change, she is, of course, free to seek other employment, as she would be at any time. You cannot continually extend temporary contracts. Changes to a contract of employment. We'll assume you're ok with this, but you can opt-out if you wish. Garden leave A contract of employment is an agreement between you and your employer that outlines the rights and duties of both sides.. At some stage your employer or you might want to change your contract of employment. When seeking to change employees’ terms and conditions, you should first look at their existing contract … Explain to your employer why you want to make the changes.