22.04.2010

CHANGING AGREED TERMS OF EMPLOYMENT

CHANGING AGREED TERMS OF EMPLOYMENT

Changing agreed terms of employment can be difficult but the employer is specific about the type of change that may be required i.e.providing for hours of work to be changed, then change can be achieved lawfully without the need for agreement by the employee. An extraordinary decision from the EAT in the case of Bateman v Asda Stores goes much further: Asda wanted to bring into line the employment terms and conditions across all its store staff, and conducted a full consultation exercise with its employees on the proposed changes. Most of the employees agreed to the new contracts of employment, but others did not. Where employees did not accept the new contracts, Asda tried to enforce them unilaterally, relying on a provision in the staff handbook that said the employer: "reserved the right to review, revise, amend or replace the contents of this handbook, and introduce new policies from time to time reflecting the changing needs of the business". Asda argued this provision entitled it to enforce changes to terms, including pay, contained in the handbook, without the need to obtain the express consent of employees. The employment tribunal held there was no reason in contract law to prevent an employer from reserving the right to amend any or all of the contract terms unilaterally, provided this authority was not exercised unreasonably, arbitrarily, or capriciously or otherwise in breach of the implied term of mutual trust and confidence in every employment contract. On appeal, the EAT ruled that a general provision to alter a company handbook in line with business needs, even though it contained terms and conditions of employment such as pay and holidays as well as policies, was enforceable without the express agreement of employees. The changes would be lawful provided that they were properly implemented with consultation and consideration of views so that the employer acts in line with the implied duty to maintain trust and confidence. The tribunal appear to have used the handbook very much as a contractual document. This, therefore, begs the question - how important is a staff handbook?

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