Responding to unilateral contract variation

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If an employer imposes new contract terms, employees who want to bring a legal challenge to the changes may decide to respond in one of the following ways:

• they may continue working under their existing employment contract “under protest” and bring a legal claim for contract breach or unlawful deduction of wages;

• if the employer has imposed new contract terms in place of the old ones, fundamentally changing the job, this can be a dismissal and employees may be able to work on under the new contract terms while claiming unfair dismissal under the old contract; or

• where a breach of contract is fundamental, an employee may decide to resign and claim constructive dismissal.

Employees who refuse to accept the new terms may face dismissal. Often the employer makes an offer of new employment under the inferior terms, known as “dismissal and re-engagement”.

Dismissals for refusing to accept new terms may be legally fair or unfair, depending on the circumstances.

Early legal advice from union solicitors should be taken when considering any legal challenge (see the box on page 21). Employees will be in a much stronger position if they act collectively with the support of their union.

These ways of responding to contract change are looked at below.