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What should I consider when updating employee contracts?

With the Government’s impending Employment Rights Bill expected to pass later this year, it is important you understand how different your employees contracts could look like in a few months’ time.

Now is the time to think about what changes need to be made and how you can implement them.

Both employers and employees can suggest changes to the agreed terms and conditions. Keep in mind that any proposed change must be mutually agreed between both parties.

What should I consider before changing a contract?

Before proposing any contract changes, it is important for employers to assess the situation and decide whether altering contracts is necessary.

As an employer, you have legal obligations to fulfil and that includes all contracts meeting the Government’s Code of Practice. Communication is important with your employees as you need to find an agreement with them that ensures you fulfil your obligations.

Should a case be brought to an employment tribunal, the judge will consider whether the employer followed the code fairly so it’s important you keep a record to protect yourself.

When would I need to change an employee’s contract?

You may need to update your employee’s contract sooner than you think because the Government’s upcoming Employment Rights Bill is expected to pass through Parliament and become law later this year.

Employee contracts will be high on the agenda with the Bill expected to cover particular terms within contracts like redundancy pay, sick pay, maternity or paternity provisions, pensions and more.

As well as law changes, you will need to analyse and update contracts when there are structural changes within the company and the needs of your customers change.

While contract changes can benefit both the organisation and its employees, they should be approached with caution due to the potential risks involved and you must be sure that is the right option.

How can contract changes be agreed?

Communication is key throughout this process, and you can speak with your employee through multiple avenues to propose contract changes.

The main point of communication is direct discussion between yourself and your employee, following a proposed change by either party.

Another option is through a collective agreement, where a trade union agrees changes on behalf of your employees.

When drawing up the initial contract, you may have included particular clauses such as a flexibility clause, which allows you to make certain changes under specific circumstances.

You should always communicate this to your employee, so they understand the clause.

What should I do before changing an employee’s contract?

It is always wise to seek legal advice and speak to employment experts before making any changes.

They will advise, guide and support you and give you the tools to help make the right decisions especially with the upcoming Employment Rights Bill necessitating the updating of many employment contracts.

Don’t let the Employment Rights Bill catch you off guard. Speak to our team today!

Amanda Hyam

Head of Dispute Resolution and Employment

I have specialised in Dispute Resolution, Civil Litigation and Employment law for more than 15 years. I understand how daunting the prospect of litigation can be and because of this I am always available to discuss concerns.