In the third article of our series on Employee Contracts, here we cover changing terms of a contract.

So, can you can you change the terms of the written contract?

If you have reserved the right to amend the terms within the contract, the answer is yes, provided you are not acting in an arbitrary or unreasonable manner.

If you have not reserved the right to amend the terms, the answer strictly speaking is no, unless it is with the employee’s agreement or consent. The outcome, however, will depend partly on how serious the change is. For example, a cut in pay rates would normally justify an employee resigning and claiming constructive dismissal – although they would probably raise a grievance first because, unreasonably failing to do so, would risk a reduction of up to 25% in any award made by the Employment Tribunal.

On the other hand, an increase in minimum paid holiday entitlement would not justify anyone resigning (although it is certainly a material change in the terms of the contract). If a change is introduced and the employees do not object, even if there is no formal agreement to the change, they may be taken to have agreed to it by carrying on working, particularly where the change has an immediate impact. But if they carry on working ‘under protest’, take advice because this can be problematic.

Whatever the circumstances, the best approach is to discuss it with them. Explain why you want to make the change, and offer incentives if necessary.

See our other posts on Employee contracts

We always advise you seek expert help on matters relating to employee contracts. Contact us on 0121 4055 101  if you need any advice.