Legal Article - Employment Law

Written Terms and Conditions of Employment

We recommend that in addition to the Principal Statement and the disciplinary and grievance procedures, that must be given, the employer should provide a clear written document expressing all important terms and conditions of employment, works rules and procedures for resolving problems (e.g. in the form of an Employment Handbook).

To leave terms and conditions of employment on the basis of oral arrangements or custom and practice is a recipe for problems and disagreements. If a dispute should arise between the employer and an employee a clear written document will often settle their differences.

This would also be of immense help if a claim for unfair dismissal was made by an employee, or the employer wished to make deductions from wages of any sums of money as under the Employment Rights Act 1996 such deductions can normally only be made legally if prior written authorisation exists.

Many employers use wide or flexible terms to help avoid the practical and legal difficulties inherent in changing contract terms. For example “we reserve the right to vary your hours of work”, or “we reserve the right to relocate you to any other premises within the boundaries of the M 25”.

These contractual clauses give the employer a degree of flexibility to alter the terms of the contract without the employees consent. Such clauses must be clearly expressed and be in writing.

When implementing the contractual clause the employer should act reasonably, otherwise the implied duty of mutual trust and confidence may be breached which could lead to a successful claim of constructive dismissal. The following procedure should be followed:

• Show why the discretionary power is being exercised

• Consult the employees concerned and assess the impact it may have on them and their work

• If one employee is affected out of several, show why they have been selected

• Give reasonable time for the employee to adjust before implementation

• Provide any reasonable help to smooth the changeover.

A written contract is also of value in enabling the employer to distinguish clearly between terms and conditions of employment they wish to treat as discretionary and those definitely contractual in nature.

The former could include such benefits as bonuses, cars, private medical insurance, share options etc. This means that an employer can change or even remove these benefits without being in breach of contract.

To provide these benefits without documentation stating they are discretionary will make it difficult to have this flexibility. Any disagreement, of course, would have to be settled by an Industrial Tribunal or other Court.

A full written contract can also deal with many other issues, which can protect the employer’s interests. These can range from terms restricting employees’ activities during and after employment through to health and safety regulations. Examples of rules that it would be helpful to put in writing are:

• The authority of management to vary normal hours of work after due notice has been given.
• The need to work overtime when required by management after due notice has been given.
• Timekeeping and time recording systems
• Statutory sickness pay which is made at the discretion of the management and a contractual term
• The duty of the employee to obey all lawful and reasonable work instructions given by a representative of management.
• The duty of the employee not to conduct himself during working hours in any manner which can be construed as;

(a) Detrimental to the interests of the employer,
(b) Offensive behaviour towards the employer or other workers in the establishment
(c) A safety hazard in the workplace which may affect the employer themselves or the workers

• The duty of the employee to take all reasonable steps to prevent loss of or damage to the employer’s premises, plant, monies, equipment and tools.

• Disciplinary, grievance and appeal arrangements.

• Competition in the employee’s own time (for example, as a self-employed vehicle repair worker) by the employee with the employer.

• The acceptance of customer’s instructions (especially in relation to bribes and other inducements).

• The conditions on which tool kits and other personal possessions may be left on the employer’s premises.

• The employer’s right to search the employee’s person, vehicle and hand baggage or parcels

• The purchase of vehicle spares or accessories by the employee and work done on a vehicle owned by the employee on the employer’s premises.

• The circumstances in which vehicles owned by the employer or his customer may be driven.

• The use and misuse of trade plates.

Unless they form part of existing custom and practice to the extent that their committal to writing implies no change in management practice (and this is unlikely), the introduction of company and workshop rules and regulations should always be prefaced by explanatory discussions with employees or their site representatives (for example, shop stewards).

If agreement on their introduction cannot be achieved, it is open to the employer to consider the use of his management prerogative by posting a copy of the rules he wishes to introduce with a notice to say that they will apply with effect from a given date (which must lie beyond the terminal date of notice which could properly be given to the longest-serving employee covered by them).

There is still a risk of the employee leaving and claiming unfair constructive dismissal. Rules should also provide for their own alteration - again, after discussion and with due notice.

Published: 24 Mar 2011

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