Express terms

Express terms are the terms specifically agreed by the employer and employee, whether orally or in writing. An express term can usually only be overridden if it tries to remove a statutory right. For example, an express term saying that a worker is entitled to just two weeks’ holiday would be overridden by the Working Time Regulations 1998 which give a right to 5.6 weeks’ holiday (see Chapter 4: Holidays).

If an express term is clear and unambiguous, a tribunal will not generally imply a term that contradicts it (see below: Implied terms). However, an express term is sometimes subject to an implied term. For example, an express obligation to relocate at the request of the employer is likely to be subject to an implied term requiring the employer to give reasonable notice of the request (United Bank Limited v Akhtar [1989] UKEAT/230/88/1210) (See Chapter 11: Redundancy).

Express terms must be interpreted objectively and sensibly. The context in which the agreement was entered into must be taken into account, but the subjective beliefs and intentions of the parties entering into the agreement are not relevant (Anderson v London Fire & Emergency Planning Authority [2013] EWCA Civ 321).

Contract terms must be clear and certain enough for the courts to work out what the parties must have intended. However, as long as the core elements of the employer’s promise are clear, courts and tribunals are generally reluctant to allow employers to escape their obligations just because some of the details are uncertain, especially if the agreement concerns important contract terms such as wages, bonuses or redundancy payments. In Allen v TRW Systems [2013] UKEAT/2013/0083/12, the EAT warned tribunals to be especially wary of employers who argue that payments intended as part of the remuneration package, once promised and communicated to employees, are merely matters of policy and discretion.

Genuine ambiguity in contract terms can sometimes be resolved by looking at evidence of a clearly established practice. For example, in Dunlop Tyres v Blows [2001] IRLR 629, the language of the written contract document relating to overtime pay was ambiguous. As a result, employees successfully argued that they were entitled to triple time on bank holidays, and not double time as suggested by the employer. The court said: “Where the language of a contract is ambiguous, practice is self-evidently powerful evidence of the parties’ intentions, to which the court can turn in order to resolve the ambiguity.” In this case, the employees succeeded because the practice of paying triple time had operated for more than 30 years.

The more serious the consequences of breaking a contract term, the greater the employer’s obligation to spell out clearly its meaning and the consequences of breach. This is especially important where an employer tries to use a contract term to control employee behaviour outside work (Smith v Trafford Housing Trust [2012] EWHC 3221).

Mobility clauses (permanent or temporary relocation) should always be expressly agreed and drawn to the attention of the employee when the contract is entered into. They should not be hidden, for example, in a staff handbook.

“Flexibility” terms — contract terms entitling the employer to make unilateral changes to the contract — must always be express. They can never be implied. And they must be clearly agreed to. They should be restrictively interpreted against the interests of the employer.

When working out express contract terms, a tribunal will begin by looking at the signed written contract terms (Quantas Cabin Crew (UK) Ltd v Lopez [2012] UKEAT/0106/12/SM). However, the written contract terms are by no means conclusive. The Supreme Court case of Autoclenz v Belcher [2011] ICR 1157 (facts summarised on page 48), confirms that a tribunal must not just look at the wording of any written contract documentation to establish the parties’ intentions. Instead, the tribunal should consider all the surrounding circumstances, including the parties’ unequal bargaining power. However, the job of the tribunal is to work out what the parties intended, not to rewrite their agreement (Smith v Carillion (JM) Ltd [2013] UKEAT/0081/13/MC, discussed on page 67, Consistent Group Limited v Kalwak [2009] EWCA Civ 98).