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Hi - Im new to this but need some advise ref my employer. I have over 20 yrs continuous service with my employer. Recently they bought over a failing competitor, but made the ex-owner a director / my new boss with my existing employer. The business is doing well and we do not have enough staff at the minute to cope with the current workload.

My department have all been advised we are to have our contracts changed and effective wage cuts imposed, by way of "department restructure". This was initially advised via a 1 to 1 meeting with the director who advised my post was effectively being made redundant (even though my duties & resposibilities will be exactly the same as before apart from my job title.) and it would be best for me to accept a change in my contract to accept the pay cut. When I spoke to the HR dept to ask what my redundancy options where I was told this was not the case and I was not being made redundant - confusing to say the least. No other department in the business is being targetted for any contract changes which makes me suspect this is a director whim to look good in front of the board and save money. He has stated if we do not agree to the changes he will be forced to "let us go" and as we refused a resonable offer to change contract we wont be entitled to any redundancy. This is having a very unsettling effect on what was an efficient and loyal department. Has anyone any xperience of such actions or advice for me?

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The starting point is that a contract is binding, and that any changes to the fundamental terms, especially hours, pay or core duties can only be made with the agreement of the employee.

 

However.

 

An employer may sometimes find it desirable - or indeed necessary - to seek to change a contract of employment. If there are genuine reasons to do this, then ultimately, in the interests of the business and where agreement is not forthcoming, an employer can terminate a contract providing that there is an offer to immediately re-engage the employee on the new terms. Failure to do this may well be an Unfair Dismissal. Even where the employer does offer re-engagement, the employee may still be able to resign and claim Constructive Dismissal arising from the breach of the employment contract.

 

It is a complex area, and may ultimately require specialist legal advice based on your unique circumstances, however from what you have outlined above:-

 

This is not a redundancy situation - a position is made redundant, not an individual, and it would appear that your job will still exist. If you were to be 'made redundant' for refusing a pay cut, and your role still existed, OR if you were to be the only person 'let go' and others with substantively the same role were retained without a proper redundancy consultation, and without those other staff also being placed 'at risk' during a consultation, then you may have a legitimate claim for Unfair Dismissal.

 

The reduction in pay is a fundamental breach of your contract without your agreement. If the employer seeks to terminate your contract, you would most likely have adequate grounds to take a case of Constructive Dismissal (and Unfair Dismissal) to an Employment Tribunal.

 

Even IF there is a genuine redundancy situation, and an alternative role is offered, then a reduction in pay is almost certainly adequate grounds to refute any suggestion that the alternative was 'reasonable'. There is no standard measure for what is 'reasonable' (and it is not for an employer to decide) as this will vary from person to person. A 10% pay cut for a senior member of staff on a six figure salary might be bearable, whereas the same cut for somebody on a lower wage might be the difference between feeding the family or not. That would ultimately be for a Tribunal to decide, but would an employer want to take the risk?

 

In the first instance, ask for written confirmation of whether your role is to be made redundant or not, and what the precise grounds are for making the position redundant. Ask also what your options are in order to avoid redundancy.

 

See what they are prepared to confirm for you and take it from there.


Any advice given is done so on the assumption that recipients will also take professional advice where appropriate.

 

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Many thanks for your thoughts on this - I have yet to see any proposals in writing (which does not surpeise me) from my employer but I will ask for these to be submitted to me to see how it goes - I think he belives "scaring" us into agreeing to a contract change is his best tactic, although I think he has underestimated me and my similarly affected colleagues !!

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