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Varying a contract of employment

08 November 2011

Category: Commercial, Employment law

The second of a series of articles by employment law solicitor Trula Brunsdon on different aspects of the employment contract.

Once a contract has been formed it does not mean there is never a need to think about it again. As with any relationship, things can change over time. Changes may be formal (eg a request by an employee to work flexibly) or informal (eg an employee asking to take a slightly reduced lunch break on a Friday and leave early, which then becomes customary).

If the employer wants to introduce a change, he will usually need to secure the employee’s agreement, unless the change is within the scope of the contract. Any clause that purports to allow the employer to vary must be drafted clearly and not be so wide as to be unreasonable. In the absence of an appropriate variation clause,  agreement is not likely to be a problem if, for example, the employer proposes to reduce hours for the same pay. It is less likely to be forthcoming if he wants to reduce hours and pay!

The employer would need to go through an appropriate consultation process but what if there is still no agreement? If the employer goes ahead with the change and unilaterally varies the contract, the employee may go along with the change, simply by continuing to work without objecting. However it is also open to the employee to object and bring a claim for breach of contract or to resign and bring a claim for constructive unfair dismissal. Finally, the employee could simply refuse to work in accordance with the change, potentially forcing the employer to discipline or dismiss him.

An employer who ends up facing an unfair dismissal or constructive unfair dismissal claim may seek to rely on the defence of ‘some other substantial reason’ (SOSR for short). SOSR is one of the potentially ‘fair’ reasons for dismissing an employee but is less well known than conduct, redundancy or capability.

Employers’ lack of familiarity with SOSR means it is sensible to get advice at the start of the process to make sure the reason for the change is good enough to justify making it and the right process is followed. Planning the situation carefully from the start can make the difference between winning and losing in a tribunal. 

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