You should always consult individually with employees with a view to obtaining agreement to changes to their contract, before these changes are made, and you may also have an obligation to consult collectively with your employees.
Generally speaking, you only need to consult collectively with your employees if the changes impact;
- More than 20 employees over a 90 day period
- Or there is a recognised Trade Union within your business
The length of the individual consultation period will depend on several factors, including the number of employees involved, the nature of the proposed change and the employees’ responses.
There is no minimum time frame for individual consultation, but best practice would suggest a minimum of two meetings, and if the employees agree to the proposed changes, the consultation period may be relatively short.
Another thing you need to consider when proposing changes to employee’s contract of employment is what you will do if they don’t accept the changes. You could;
- Dismiss them and then re-engaging them on the new terms. This is not an approach we would advise, and is fraught with issues, plus this is also likely to be banned in the near future as part of the Labour Manifesto “Plan to make work pay”
- Allow them to resign as you believe the changes to their terms are reasonable. Here you run the risk of an unfair dismissal or constructive dismissal
- Offer them something, known as “legal consideration” for them to accept the changes you are proposing. This could be for example an increase in their annual holiday, or an increase in salary or pension contributions, or a one-off payment.
How can we help?
This is a complicated area and it’s really important to seek HR advice and input before you make any changes to your employee’s Terms and Conditions of Employment, to ensure you are following the legal requirements around consultation, and that you have considered which of the three options you will take if they refuse to accept the changes. If you are thinking about doing this, then please book a meeting with us to make sure we help you do this the right way!
