Changing terms and conditions of employment

Topic Index
Variation by agreement
Collective agreements
Variations allowed for in the contract
Imposing changes unilaterally
Dismissal and re-engagement on new terms
Action points



  • Changing terms and conditions of employment is a complex area and one which can cause problems in balancing the needs of the business and the rights of staff. However, with some understanding of the issues involved, problems (both legal and HR-related) can hopefully be avoided or at least minimised.
  • This Checklist sets out some general guidance for employers and concludes with an action point checklist.
  • An employment contract can be varied in a number of ways (each of which are considered in more detail below):
    • by express agreement (in writing)
    • by a collective agreement
    • by variations allowed for in the contract
    • by unilateral imposition of new terms, or
    • by dismissal and re-engagement on new terms
  • Not all variations will involve a breach of contract as some documents, e.g. parts of a staff handbooks or sickness absence policies are sometimes not contractual and most bonus schemes are non-contractual. In such cases, employers may change such rules without employees’ consent.
  • Be aware however that some provisions in staff handbooks can acquire contractual effect, particularly where the employment contract refers to the handbook to flesh out the detail, e.g. an enhanced redundancy policy.
  • Promotion is an ideal time to change contractual terms and conditions (e.g. including a mobility clause) as when someone is promoted he or she is in effect accepting an offer of working under a new contract of employment.
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