The UK Rules
'Follow the Regulations'
Changing a Contract

Rules for Changing Employment Contracts

There are various reasons for making changes to employment contract terms and conditions. Both parties need to understand their rights before getting the contract changed.

CONTRACT CHANGES: There are problems to avoid or resolve when changing an employment contract.

Step 1: Getting the Agreement

As a rule, both the employer and the employee need to agree to make contract changes.

But, in some cases the employee can insist on a change to certain terms and conditions. They must have a legal right to force this particular issue.

Role of Employers

An employer cannot change an employment contract without employee consent. They must get their employee's full agreement if they want to make changes to the contract.

Before an employer starts changing an employment contract terms and conditions they should:

This is also an opportunity to talk with your workers and inquire about their future plans. Older employees may give you their thoughts on early retirement and other plans for work. This might include making changes to their role in the workplace or working hours.

Role of Employees

Start the process by explaining to management why you want to make some changes. There are situations when you can insist on a change to your employment contract. But, it must be a change that a statutory right covers (e.g. to stop working on Sundays).

Step 2: Making Changes to the Contract

Having agreed the contract changes with their staff, the next step for employers is:

There may be instances where an employer changes some terms and conditions that are not in the written statement. An example might be an employee's right to sick leave.

In this case employers should inform their workers where to find the changes. The changed information could be in a company handbook, intranet site, or noticeboard.

Collective Agreement

You may make changes to collective agreements with trade unions or staff associations. But, employers must inform their staff of any collective agreement contract changes.

These type of changes can affect the terms of written statements like working hours and pay. This can happen even if they are not a member of the union or staff association.

Flexibility Clauses

Flexibility clauses are part of some specific terms in a contract. As a rule they give employers the right to make changes to some conditions to employment. A common flexibility clause could include employee relocation for example.

Note: Employers can only use flexibility clauses when the changes are reasonable. An unreasonable example could be giving only 1 week notice to an employee to go work overseas.

Changing Your Employer

What happens if you start working for a different employer? In this case you usually will get a new written statement of employment within 2 months.

The rules for changing employment contracts do not apply if only a business name changes. Likewise, if you get a new employer but no other changes in the t's and c's. In both these cases employers do not need to issue a new or changed written statement. But, they must inform their staff about the changes within one month.

Disciplinary Measures and Demotion

Disciplinary measures can result in changing an employment terms and conditions. The same might apply in a case of employee demotion.

Employers should ensure the staff handbook or intranet site provides this information. You can give an outline on how this could happen in the disciplinary procedures section.

Step 3: Dealing with Contractual Problems

When you change an employment contract terms and conditions problems can occur if:

Solving an Employment Contract Dispute

There are various ways employers and staff can solve a workplace dispute. But, solutions are usually less formal when disputes involve contract changes. You can try talking it through or using mediation.

A trade union member can get proper advice from their union representative. You can also contact Citizen's Advice, Acas or the LRA in Northern Ireland.

Acas Helpline
Telephone: 0300 123 1100

Labour Relations Agency Helpline
Telephone: 028 9032 1442
Not all call charges are free in the United Kingdom.

As a rule employers or employees can take legal action if the problem remains unsolved. At this point, getting legal advice is important because it can be expensive. Trade union members can usually get legal counselling from their union.

Making Contract Changes without Agreement

Employers should not make changes to an employment contract without getting staff agreement. This includes using flexibility clauses in unreasonable situations. If any of these contractual breaches occur employees may:

Note: An employment tribunal is also called an 'industrial tribunal' in Northern Ireland.

What if employees disagree with the new terms and conditions but say or do nothing? In this case it often counts as agreeing to the changes made to the employment contract.

Re-employing Staff on New Terms and Conditions

In some cases, employers can end a contract and then re-employ the staff member. But, re-employing the same employee on new terms and conditions is often seen as a last resort.

All employers must follow employee dismissal procedures when they end an employee's contract. That also means adhering to the required:

In some cases dismissing and re-employing staff could qualify them for a tribunal. Your employee could then make a claim for:

Employee Claim for Breach of Contract

An employee may claim breach of contract if they fail to solve an issue with their employer. In this case they might take their case to an employment tribunal or a civil court. It would be an industrial tribunal if the case occurs in Northern Ireland.

Even so, in most cases the employer would be able to make a counter-claim to the action.

Employment tribunals only deal with claims and counter-claims if they:

Note: You cannot connect this type of claim or counter-claim to a personal injury. This also includes certain types of contractual terms such as intellectual property rights.

Tribunal Time Limit

As a rule, employees must make their claim to a tribunal within 3 months of losing their employment. Employers get 6 weeks from the time they receive a copy of the claim to choose whether to make a counter-claim.

Award Compensation Limit

The tribunal may award compensation if they agree with the claim made by the employee. But, compensation can only be for a financial loss such as non-payment of salary. The maximum award compensation limit for this type of claim is £25,000.

Rules for Changing Employment Contract Terms and Conditions