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Alan Price

Peninsula Business Services

Employment Law & HR Director

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Can an employee’s contract of employment be changed once signed?

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It is not unusual for a change to employees’ terms and conditions to present itself in an employment relationship. These changes can arise due to a number of reasons, for example, an employer may wish to reorganise their business structure or workforce so that it is more economically efficient.

When an employer finds themselves in a situation where change is required, the agreement of the employee concerned must be obtained in order to bring about a safe result.

Agreement should be sought via comprehensive discussions between the employee and employer.

You should be prepared to give a thorough explanation of why the changes are needed because transparency and honesty are likely to make the process easier. If any changes are agreed on by both parties as a result of discussion, they should be recorded in writing.

What happens when employees disagree?

If an employee does not agree to the proposed changes and you are unwilling to compromise, you might want to consider offering an incentive. For example, you might wish to propose a higher contractual holiday entitlement or enhanced break provisions to them. This may encourage the employee to agree to the new contractual term and maintain good relations.

Ultimately, if an employee were to maintain their disagreement, you may terminate their employment and simultaneously offer re-engagement under the new terms but this could carry a risk of unfair dismissal if the procedure were not carried out correctly.

If an employee does not agree to the proposed changes and you are unwilling to compromise, you might want to consider offering an incentive.

Sometimes there doesn’t need to be an agreement

Some changes to terms do not require agreement. Where changes to the law affects terms, you do not need agreement, for example, when the smoking ban was introduced meaning that it was no longer lawful to smoke in workplaces. This would override any existing smoking policy that any business had and would automatically amend it.

Specific rules apply when employees have been transferred to your business under the Transfer of Undertakings (Protection of Employment) Regulations 2006. This is because the employees’ existing terms and conditions transfer to the new employer and are protected.

This means that a transferred employee could make a claim to tribunal if terms were changed where there is not an economic, technical or organisational reason entailing changes in the workforce. Changes to terms that are unconnected to the transfer are permissible.

Employees can make changes too

Employees have the right to request a change to their terms and conditions in relation to their hours of work; time of work and also its location. This will be done via a flexible working request and a code of practice sets out the procedure to follow where this is done. 

Employees have the right to request a change to their terms and conditions in relation to their hours of work; time of work and also its location.

You can reject a flexible working request for a number of reasons, including on the basis of additional costs for the business, the inability to reorganise work among the remaining staff or if it may have a damaging effect on the ability to meet customer demands.

Businesses constantly evolve and change, which will inherently lead to changes being brought forth to an employee’s contract of employment.

In light of this, whenever changes to an employee’s terms of employment are to be made, the employer must provide a written statement, which includes all the new terms and conditions of employment within one month of the changes taking effect.

Author Profile Picture
Alan Price

Employment Law & HR Director

Read more from Alan Price
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