An organisation has historically paid all employees an annual pay rise in line with cost of living increases. It has also paid a discretionary annual bonus to all staff. Neither of these items are mentioned in contracts of employment.

The organisation is considering the introduction of a performance related pay scheme which will replace both the cost of living increase and the bonus. If an employee underperforms it is proposed that they recieve no pay increase for that given year.

I am concerned that the previous practice of pay increases and bonuses have become implied terms of employment through custom and practice. So proper consultation and agreement etc will be a necessary approach to introducing the changes. Rather than jus decent communication and notice of the planned changes.

I’d love to her from any of you who have experience / knowledge of a similar situation.

Am I being too cautious?

Thank you.
Sarah Jennings