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Express or implied agreement to change
[ch 3: pages 77-80]An agreement to a change of contract can either be express (for example, through verbal consent or by signing the new contract) or implied by the employee’s conduct. For example, if an employer announces that working hours will change from a 9.30am start to a 9.00am start and the employees come in at 9.00am the next day and carry on coming in at 9.00am without objecting, this creates an implied agreement to change their hours to a 9.00am start — even if they have not said “yes” or “no” to it.
It is important that employees are made aware that failure to oppose a change could mean they will be taken to have accepted it and may not be able to challenge it later on. This is not always the case. Tribunals are generally reluctant to rule that a unilateral change has been impliedly agreed to where the change does not have immediate effect. For example:
Ms Aparau was given a new contract that said she might be required to move to a different location at any time. She did not sign it but continued to work. The EAT held that where a new term is introduced unilaterally (i.e. without agreement) but does not take effect immediately, a tribunal should be very careful before it finds evidence of implied acceptance.
Aparau v Iceland Frozen Foods [1996] IRLR 119
As always everything depends on the individual facts, as the following case shows:
Ms Wess began work as a museum curator in 1979 on civil service terms, including six months’ notice. Following a restructuring in 2003, she was sent a new contract and handbook, which cut her notice to 12 weeks. Wess never signed the contract to confirm acceptance but neither did she ask questions about it (there was an inquiry line to call), or object to the reduced notice period, although she did object to other aspects of the new contract. Wess carried on working for nine years until she was dismissed. She argued that she should have been given six months’ notice as she had never accepted the new terms. The EAT noted that Wess was an active trade unionist and suggested that she must have known the detail of her new terms and conditions and could have raised queries on them if she wanted to. Her silence, combined with continuing to work, implied acceptance.
Wess v Science Museum Group [2014] UKEAT0120/14/0610
An employee will be taken to have impliedly accepted changes to their contract terms if that is the “only sensible explanation” for their behaviour, from the perspective of an outside observer. In other words, the fact that privately they do not intend to accept the contract changes is irrelevant if that is how it looks from the outside. For example:
Mr Lacy was offered promotion with benefits that included private health insurance. The new contract terms also included restrictive covenants. Lacy did not sign and return his new contract terms, but he did apply for the insurance. When his employer later attempted to enforce the restrictive covenants, Lacy argued that he had never agreed to them. The court disagreed. By taking up the private health insurance after reading the new terms and without protesting about any of them, Lacy accepted the whole contract, including the restrictive covenants. The fact that privately he did not intend to accept the new contract terms was irrelevant. What mattered was how his behaviour appeared to a reasonable outside observer.
FW Farnsworth Limited v Lacy [2012] EWCH 2830
If contract terms change, the employer must issue a new written statement of employment particulars detailing the changes within a month (section 4, ERA 96) (see page).
An employer that changes its name must provide a new statement, which must include the date the employee’s continuity of service began.
In workplaces with a recognised union, contractual changes usually occur through collective bargaining. Collective agreements are typically incorporated into individual employees’ employment contracts by a specific reference to the agreement in the contract. However, if changes have always been made through collective bargaining in the past, this might be taken as implied agreement to changes made in that way.
Increasingly, contracts of employment include terms that permit future unilateral changes to core terms and conditions, such as pay arrangements and hours, by the employer. A unilateral right to vary a contract is an unusual power (Security and Facilities Division v Hayes [2001] IRLR 81, Hart v St Mary’s School (Colchester) Limited [2015] UKEAT/0205/14/DM). Express flexibility terms must be express and clear (see page 68). They cannot be implied.
Where a contract contains an express term permitting unilateral change, the employer must not act unreasonably (Wandsworth London Borough Council v D’Silva [1998] IRLR 193). The employer can only impose it in such a way that the employee can comply (United Bank v Akhtar [1989] IRLR 507), and must not do so in a way that destroys trust and confidence (White v Reflecting Roadstuds [1991] IRLR 331) or behave arbitrarily and capriciously. In general, a court is unlikely to accept an interpretation that goes beyond existing contractual obligations, for example, adding significant extra duties or hours to a job role, as opposed to varying existing hours or duties.
Flexibility and mobility clauses should always be interpreted narrowly and any ambiguity should be resolved against the interests of the employer. For example:
Ms Thorley worked as an architect. Her employer wanted to rely on an express contract term that required her to perform “any other duties which may reasonably be required” to force her to change from a hands-on architectural role to a managerial one. The EAT said imposing the new job description was a fundamental breach of contract which had the effect of deskilling her.
Land Securities Trillium Limited v Thornley [2005] IRLR 765
In Hart v St Mary’s School (Colchester) Limited [2015] UKEAT/0205/14/DM, a school was not able to rely on an express flexibility term to force a part-time teacher to change her hours from three full days a week on specific days to the same number of working hours spread over five mornings, to suit new school timetabling requirements. The language of the written contract did not allow the school to change Hart’s hours without her agreement.
In the following example retail giant Asda was allowed to rely on a general contract term contained in the staff handbook permitting unilateral change to employment terms “to reflect the changing needs of the business” to enforce a new pay structure:
Asda introduced a new pay structure for new staff and wanted to extend it to existing staff. It engaged in consultation but a large number of employees rejected the proposed change. Asda then imposed the new pay structure by invoking a widely drawn clause in the Staff Handbook allowing it to make variations “to reflect the changing needs of the business”. Seven hundred Asda employees brought claims for unlawful deduction from wages, breach of contract and unfair dismissal. The EAT concluded that the term was clear and unambiguous and that Asda had complied with the contract and not acted “arbitrarily or capriciously”, or in breach of the duty of mutual trust and confidence. The claims failed.
Bateman and others v Asda Stores Ltd [2010] UKEAT/0221/09
Recent changes to TUPE explained on page 400 of Chapter 12 encourage employers to make even greater use of express flexibility clauses.
One specific type of contract term enforcing unilateral change is the mobility or relocation clause — allowing the employer to impose temporary or permanent changes to work location. A mobility clause cannot be implied. It must always be express and clear.
Union reps should be very cautious when faced with mobility clauses. In particular employers have used these clauses successfully to avoid paying redundancy payments (see page 325, Chapter 11: Redundancy).
There is no entitlement to be paid to relocate unless the contract says so. However in United Bank v Akhtar [1989] IRLR 507, a requirement to relocate from Leeds to Birmingham the following week with no relocation expenses was held to be a breach of contract because the employee was unable to comply.
Sometimes a change, for example, to existing working patterns, location or hours, may amount to unlawful discrimination (see Chapter 6). For example, an employer who insists on changing from a day shift to a night shift risks a claim for sex discrimination because of statistical evidence that women are more likely than men to have caring responsibilities (London Underground Limited v Edwards (No 2) [1997] IRLR 157).
The Public Sector Equality Duty, where it applies, can also play an important role resisting this kind of change (see page 194).