Changing the terms of an employees’ contract is a two-way process. They may have asked for something to be changed, or you might need to make a minor or major adjustment.
Just remember, before you do anything your employee or their representative must agree to the changes. This can be as simple as quick conversation or a complicated, drawn-out process that may mean you need legal advice.
Once your employee has agreed to the proposed changes, there are two things you must do:
- Amend the employee’s written statement, which contains the terms and conditions of their employment.
- Provide a letter outlining what changes have been made.
For additional guidance about negotiating changes to an employment contract, read our guide about how to amend an employee contract. If you want more information about negotiating changes to an employee contract, get in touch for professional advice from our experts in employment law.
Where to outline the changes to a contract amendment letter
An employee contract can take many different forms, from a complex written document to a simple verbal agreement. In plain terms, if you agree to pay someone for work, you’ve entered into a contract.
However, if someone works with you for more than a month, you must provide them with a ‘written statement’. This should be given to employees within two months of their start date.
- What is a ‘written statement’?
The written statement can be a single document, or several different ones. The main, or ‘principal statement’ must include:
- Name of business.
- Name of employee.
- Employee’s job title or a description of what they do.
- Start date (if they had a previous role that their current role is a continuation of, also outline their original start date).
- Information about pay (how much they’ll be paid and when).
- Working hours and holiday allowance.
- Location of employment.
Other information to include somewhere in the written statement documentation:
- If temporary, include what the set notice period is.
- If fixed-term, include the end date along with the notice period.
- Any details about collective agreements.
- Information about pensions policy.
- Contact details for who the employee should speak to if they have a complaint, and how to complain.
- Where to get information about sick pay, disciplinary procedures and grievance policies.
Once an employee has agreed to the changes to their contract of employment, you must update the written statement to reflect them.
Amending a written statement and writing a contract amendment letter
Before making any amends to a contract, you must get confirmation from your employee that they agree. It can be done verbally, but it’s best to get written confirmation you can fall back on should any issues arise.
When you have confirmation, you can amend their written statement to reflect the new terms. After that, you have one month to give the employee a letter, outlining the amends to the contract.
This letter should clearly state:
- What the change is.
- The date of the change.
- Where they can find the change in their written statement (i.e. “clause X”).
- The reason for the change.
- Who they can speak to if they have questions about it.
[EMPLOYEE CONTRACT AMENDMENT LETTER TEMPLATE]
If an employee is unhappy with the changes, or say they haven’t agreed to them, they may raise the issue in an employment tribunal.
Because it can be a complex and sensitive topic, it’s best to speak to a business law professional when making changes to an employee’s contract. Our expert advisers will listen to your unique circumstances and can help toward answering any questions you might have about changing a contract and writing an amendment letter. Speak to someone today.
Note: First4lawyers offers this information as guidance, not advice. Before taking any action, you should seek professional assistance tailored to your personal circumstances and not rely on First4lawyers’ online information alone.