The world is moving fast and as we keep hearing, we are in unprecedented times. This means that for businesses to remain successful and profitable, occasionally they need to change the way in which they do business. When this involves changing the way in which their staff conduct their daily activities, doing so without opening themselves up to litigation can be complicated.
When employees are on-boarded to an organisation, they sign up to a set of terms and conditions of employment which generally state the responsibilities of their role, the salary and other benefits that they will receive and the hours and working pattern that they have agreed to. When a change is required to one of these fundamental terms, a business cannot unilaterally make changes without the prior agreement of the affected employee, otherwise, they could be subject to a constructive dismissal claim.
Constructive Dismissal
Constructive dismissal is the term given to a situation whereby an employee who has had changes imposed upon them without their consent chooses to leave rather than accept those changes. When this happens, it is widely considered to be equivalent to an unfair dismissal, in which the employee is entitled to a severance package and potentially damages as well. This can be very costly for businesses, both financially and reputationally.
Pivoting Properly
Requiring personnel to work from home during the pandemic was the first pivot, and it was widely accepted as an appropriate solution for both businesses and their staff. However, now that employees are more aware of their rights and responsibilities, enacting other wide-scale changes without their prior agreement, particularly if they affect the fundamental terms and conditions of their employment, could be a poor move.
The way to avoid being subjected to constructive dismissal claim while restructuring, reorganising or streamlining the business is to ensure that staff are on board with the changes. Each situation is unique and taking appropriate legal advice is always recommended to ensure that changes made do not constitute constructive dismissal. You can contact Employment Law Friend or a similar firm for tailored advice, if required.
For those businesses whose terms of employment are flexible or require that staff be mobile, and where it is expressly articulated that such changes will not constitute constructive dismissal, implementing new policies and practices should be quite straightforward. For those with more tightly defined contracts, gaining employee buy-in is essential before changes are made. Even once an employee has signed an updated contract, a notice period will need to be provided whilst the changes settle in to ensure that they are satisfied with the new terms and that changes made do not create a toxic environment or unintentionally discriminate against certain employees on the basis of protected characteristics.
Summary
It is widely accepted that sometimes the way in which business is conducted has to change in order for that business to remain competitive and doing this correctly can deliver enormous business benefits. Getting it wrong could create a legal minefield and cost a business time and money to resolve.
