Changing an employment contract

With many employers looking at changing contracts as a way of avoiding redundancies, we ask Acas advisers Mark Makin and Helen Robinson how to do it well. We explore:

- The best way to change employment contracts - Why consulting staff matters - How to do this well remotely - What your rights are as an employee

Episode Resources

https://www.acas.org.uk/changing-an-employment-contract

Transcript

Sarah Guthrie Welcome to the Acas Podcast. We're talking today about changing an employment contract with Acas advisors, Helen Robinson and Mark Makin, and I'm Sarah Guthrie. This is topical at the moment because lots of employers are looking at changing contracts as an alternative to making people redundant. So employers are asking, how can we do that? And members of staff might be asking us, can my employer do this? So Helen, let's start off with employers. What's the best way of going about changing an employment contract?

Helen Robinson There's a number of different ways that an employer can can consider changing somebody's contract or varying the terms and conditions. But I think the best way from an Acas perspective would be where possible to do so by agreement. If an employer speaks to a member of staff, and they are able to get their agreement to make a change to their terms and conditions, then ultimately that is going to be the best way for conducive working relationship moving forward.

Mark Makin To echo what Helen said there, taking the workforce with you - informing, explaining consulting, discussing, providing feedback - that sets the tone for the relationship once the change comes into effect, because the trust and the goodwill will need to be there to take the organisation forward afterwards. And if we make changes without agreements, there's a big possibility that that trust and goodwill won't be there, which is going to create problems with itself.

Helen Building on that, I mean, what some employers are choosing to do is to see whether they can make these changes on a temporary basis because staff might be more willing or accepting to the changes there. And I've also spoken to an employer recently who has offered an incentives so the change that they were looking at making was a 10% pay cut and that was across the board 10% pay cut for all staff. That was a measure to look at avoiding redundancy. And what the employer said almost as an incentive was that if this didn't work, and if actually they did need to make any redundancies within the next 12 months, their redundancy pay and their notice pay would be calculated at their original wage so that the wage that was slightly higher, and so that that was something that went some way for for stuff agreeing to that change.

Sarah Yeah, I can see why that would really help because we've heard stories of people who have agreed to a temporary pay cap with a perception that then they won't be made redundant and get made redundant and then also have their redundancies as calculated on their most recent pay, which is half of what they were being paid. So I guess it, it sounds like thinking through in detail how your staff will respond to the changes you're proposing both in the short term and the long term is really important here. Some people listening to this podcast might be thinking, Well, can employers change a contract? What are my rights? I wondered if you could give us an insight into that.

Helen If a member of staff agrees to a change, then absolutely a change can be made to that contract, whether it's on a temporary or a permanent basis. I think it's very, very important when we're looking at agreements and agreeing to a change that an employer is very open and honest about what this change is going to be. How long is it going to last for? Is it going to be permanent? Because employees need to have that information so that they can make an informed decision about whether they are happy to agree. But I also think it's equally if not more important for emplo