All employees must have an employment contract. This will detail the agreement between the employer and employee regarding the working conditions, rights, responsibilities, and duties of the job position. This contract is a binding document until it ends (e.g. if the employee gives notice or is dismissed) or until the terms of the contract are changed.
But how do you go about changing an employment contract?
There may be situations that arise which means that the employment contract needs to be modified. Changes may include a change in working hours, a change in salary or a change in the job role for example.
For these changes to take place, there needs to be an agreement between the employer and the employee. There should be a discussion about why the changes are being proposed and what the impact of the changes will be. It may also be necessary to consult a trade union representative if there are concerns about the impact of the changes, who may open negotiations on behalf of the employee.
There are some terms in an employment contract that can be included under a ‘flexibility clause’. Variable terms could include the hours worked, rates of pay and the location of work. If there is a variation clause in the contract, and the changes are detailed here, there is no requirement for the employee to agree to the changes proposed as there is no actual change to the contract. The original contract detailed that these changes might occur at a later date.
Even though there is no need to negotiate the changes you propose if they are covered under the flexibility clause, it is still advisable to discuss the proposed changes and the reasons for them to maintain positive working relationships and to build trust with your employees.
Employers do have the right to insist on a change to an employment contract, whether they agree or not, as long as it is not covered by a statutory right (such a pay decrease which wasn’t in line with the national minimum wage).
Communication is key
However, an employee may raise a grievance if they feel they have been treated unfairly. A willingness to communicate, share ideas and reach compromises is essential to trying to reach an agreement on possible changes before decided to enforce a change.
Changes can be agreed verbally or in writing but, for the sake of clarity, confirming a change in writing will ensure there can be no misunderstandings. If the changes that are made affect statutory rights, they must be recorded in writing and employees officially notified within a month of the changes being implemented.
If you would like more information on making changes to your employment contracts or would like to review your employee contracts, please get in touch for a free, no-obligation chat with one of our professional HR advisors.