No Image Available

Martin Brewer

Read more about Martin Brewer

Ask the expert: Short-term lay-offs

question_mark
How much notice does an employer have to give to shift workers, if there is no work available for them to do on a given day? Martin Brewer and Esther Smith advise whether short-term lay-offs would need to be imposed.
 

The question:

I have just started work for a small construction/professional cleaning company. We provide construction and cleaning staff to the airports. As you might guess, work is very slow and on some days, we may not have any work for the staff.

My question is, how much notice do we have to give that we don’t have any work? The staff work in shifts, so we may not know until an hour or even less before the shift starts, that we don’t have work for them. Do we, in that case, have to pay them for a day’s work even though they’ve done none? We have a clause in our contracts about lay-offs, which says that the company reserves the right to temporarily lay-off staff without pay or to reduce normal working hours and/or days. The contract was supposedly drawn up by a professional so I assume it’s OK but can you confirm this?

Legal advice:

 
Martin Brewer, partner, Mills & Reeve
 

This is indeed a purely contractual question.  You need to look at what the contract says about notice (or any policy/practice).  If the contract is silent and there’s nothing else to go on what you need to know is that strictly contractually speaking you can give whatever notice you want.  However, one important caveat is that in implementing a contractual term you cannot act in a way which in effect makes it very difficult or impossible for the employee to comply with the contract.  So for example there’s no point in giving 5 minutes notice if an employee is going to take 30 minutes to arrive.  To do so would be a breach of trust and confidence.

As to whether and in what circumstances staff have to be paid, that entirely depends on the drafting in the contract.  Your arrangements sound unusual so get an employment specialist to look at them.
 
As to whether you can unilaterally reduce hours, answering this will require someone to look at the contract.  Courts do not like clauses which in effect allow unilateral variation so very careful drafting will be necessary.

 

Martin Brewer can be contacted at [email protected]. For further information, please visit Mills & Reeve.

* * *

Esther Smith, partner, Thomas Eggar
 

The starting point on any discussion regarding an employer’s ability to lay-off staff or impose short-time working is the contract, so it is important that the provision is already included in your contracts. Given the nature of your industry I would also expect your employees to be on fairly flexible contractual terms anyway, with no minimum contractual hours, but with varying hours required of them each week, and an arrangement whereby shifts are confirmed etc on short notice. In this case, arguably you don’t need to lay-off or impose short-time working, as the employees would not have a contractual entitlement to be working hours anyway, unless they were previously confirmed to them. Effectively, rather than have employees on a 37.5 or 40-hour per week contract you would have a contract with no minimum guaranteed hours.
 
There are some statutory provisions that apply where the reduction in hours (and therefore pay) meets certain thresholds which govern employees’ rights to things like a minimum level of guarantee pay, but these are quite detailed and difficult to give a generic overview, so if you have not already done so you should take specific advice on your situation.

Esther Smith is a partner in Thomas Eggar’s Employment Law Unit. For further information, please visit Thomas Eggar.

Newsletter

Get the latest from HRZone

Subscribe to expert insights on how to create a better workplace for both your business and its people.

 

Thank you.