Sorry, this is a long. Bit of background:
I work for a big company that is constantly acquiring others, and as a result I’m employed by a different legal entity that all of my current team. Their contract terms are slightly better than mine; 1% extra pension & 5 extra days holiday (but 39 hour week vs 37.5). After years of asking HR have finally agreed to move me over.
In May 2020 the company asked many UK employees to work a 4 day week and take a 20% pay cut for 3 months. After the 3 months they asked for us to do it for another 3 months, but 1 month in they cancelled it and put everyone back full time.
For personal reasons, I accepted the first time and rejected the second time, there was a high chance I needed a new mortgage and needed my absolute max salary for 3 months…
So, having the discussed the differences in benefits with HR it sounded like a no brainer to switch. They sent over the new contract and I have to admit it’s much longer, with many more terms than the one I signed 14 years ago, but it was the final term that has taken me by surprise (full details of it are below). It’s obviously been added very recently so would be a term that none of the rest of my co-workers have.
I’m wondering if this is actually legal? I’m not sure if I’m worrying over nothing here. But the company have obviously very deliberately put these terms here and I think they put me in an unfavourable position to the one I’m current in. The wording seems all rather vague and, so a degree almost makes it seem like my contract would effectively be zero hour. I actually work in IT on projects, the wording is so open that technically it sounds like if a project ends and a new one doesn’t immediately start, they could lay me off for months (no definition of short term) until a new project starts. If they do the 4 day week again and have to ask 99% of the UK employees for their permission, but not me and handful of other new employees, we just automatically get put on it.
Lay-off or Short-time Working
Receipt of your salary is dependent on you being provided by the Company with work of the type you are employed to do. If the Company has a reduced need for your work, or there is any other disruption to the Company’s business, the Company reserves the right in its absolute discretion to impose a lay-off whereby you will not be required to work and will therefore not be paid, or to impose short-time working with a pro-rata reduction in pay. The Company will give you as much notice as is reasonably practicable of any lay-off or short-time working and of any further change to hours, including a return to normal working hours. The Company may in its absolute discretion determine the duration of any period of lay-off or short-time working.
During any period of lay-off or short-time working you must remain contactable and available for work if required. You may in certain circumstances be entitled to receive a guarantee payment in which case the Company will comply with its statutory obligations.
I’m no HR lawyer, but i don’t like the look of that.
The wording is totally one way and completely imbalanced against you. I read that to say they can indeed lay you off, but keep you hanging on the end of the hook whenever they like. All they need to do is show a ‘reduced need’.
I guess there’s a risk balance here i.e. is it an emergency clause that they’re just using to protect themselves, but in all likelihood will never actually be drawn upon? Though if they’re quite an aggressive business, as per your intro, then that would suggest to me that they’d be more iikely to be more cutthroat about it all.
So, i’m just a guy on the net. But i personally don’t like the look of it. Others (like @Poet who i just note has responded) in the industry may offer more insight as to how ‘normal’ that is. I don’t think there’s anything untoward (it looks perfectly legal, just rather one sided) about it though, as they’re offering it to you … you don’t have to accept and could stay on the current contract.
Do you have free legal advice on something like your home insurance you could call upon?
That term looks a little iffy to me and biased to the employer, but as @gingerbongo intimates, go get some professional legal advice from someone who specialises in employment law. Are you a member of a professional body that can offer legal advice to members??
Is that not basically a switch to a ‘zero hours’ contract? Looks a bit iffy.
Thanks for the PM Poet, I thought I would add some comments:
I work in the IT dept of a huge company, so they are all internal projects. We’re not an IT company working for clients.
A huge amount of the company in all departments, not just IT, were asked to work the reduced working week.
The request to change contract has come from me/my manager, rather than being pushed upon me. It just so happens this new term has been added. If my request had been granted a year ago I’d not have had this issue.
I think I’m going to reply to HR and say I’m not happy. I guess their answer will be to either stay on my existing contract, or sign the new one to get the better benefits.
can you absolutley be sure of that?? if they are treating you differently then you may have a case for unfair treatment.
I’m 95% sure. It’s the 34th clause out of 35, and I’m assuming they generally added them in order.
I did ping a trusted colleague after posting and shared the details with them. They are on Corporate contract that I would be moving too, and they were quite surprised by it and shared my concerns.
The last contract I signed was 14 years ago when I joined. I’m sure that they are constantly tweaking the contracts over time, and they never ask the existing employees to sign up to the new terms.
One thing I was quite surprised about is that despite being promoted multiple times over the years, they never asked to increase my notice period from the 4 weeks in my original contract. Everyone I employed (e.g. at lower levels than myself) on the corporate contract were on 3 months.
Personally, I wouldn’t be signing that without having professional advice first. It’s appears to be quite a risky clause for the employee.
that’s frankly bad practice and bad management. when we had our company, if we made any contractual change we made sure it was applied across all staff and newly issued contracts were signed.
but keeping the month’s notice is a bonus these days as it gives you more flexibility if you decide to change jobs.
I deal with clauses in a commercial sense everyday. I hate to see anything in a clause that says ‘reasonable’ or ‘best endeavours’ and the real alarm for me ‘absolute discretion’.
That is very one way. It gives you no assurance to longevity or continuity. Money on the table is money on the table and if it was take it or leave, I’d take it and then use it as a catalyst to find another job.
I’m with FP here… while a quick bit of Googling suggests the clause is perfectly legal, personally, it would have me asking questions over how one-way the relationship is…
I like three months notice, means PILON should redundancy happen
Which then means you’ve got either time to find a job you wanna do, or cash to do whatever with.
One for the lawyers and the unions in my opinion.
They want to be able to sack you whenever they feel like it. That’s not permanent work. That’s contract work. If they have piecemeal projects they should be hiring contractors like me, not endangering their permanent staff.
Sorry to be clear I don’t think this clause as anything to do with piecemeal work in general, but in my particular case I was worried it could be used in that way.
I’m certain this was added as a result of COVID, where like many businesses revenues took an immediate tumble and the company took various permanent and temporary cost saving measures.
The company actually did very well last year, I not only received my bonus but it was above target. Without giving away too much, we benefitted from the large take-up of DIY.
I believe the clause would be in any new employees contract no matter what role they have. I personally just happen to work in IT, in a role that is project based. I do work across multiple projects as we have gone to a very outsourced model, so I kind of manage the vendors.
I have no real reason to believe the company will ‘abuse’ the clause, generally they do treat people pretty well. But I really don’t like what it could potentially be used for.
You don’t have to accept the clause, or you could mark it up. People negotiate the contract all the time but the more they want you, the easier that is to do.