A judgment of the Employment Appeal Tribunal (EAT) (Bateman v Asda Stores Ltd) in February confirms an employer’s right, if the right contractual provisions exist, to change employees' pay and work conditions without getting specific agreement of employees.
Asda wanted to impose a common pay and work structure across all employees to achieve uniformity where there were inconsistencies. There was lengthy consultation with unions about the proposed changes. Assurances were given that employees would suffer no reduction in pay because of the changes. Many staff voluntarily accepted the change but some had their contracts changed without their agreement.Asda’s handbook which was part of each employee’s contract provided that Asda 'reserved the right to review, revise, amend or replace the contents of this handbook, and introduce new policies from time to time reflecting the changing needs of the business’.
When the changes were implemented some of the employees who had not agreed to the changes started employment tribunal claims alleging unauthorised deductions from wages. In fact, by the end only one employee still alleged an actual loss. The employment tribunal agreed with Asda that it was permitted to impose new conditions without actual employee approval. The employees appealed saying that Asda was unable to depend on the staff handbook provisions to support imposing the new terms and that the consent of all staff was required to do so.
The EAT dismissed the appeal and accepted that the passage in the staff handbook that Asda relied on was wide enough to allow Asda to change terms identified in it. That included the new pay and work structure that had been introduced. One wonders whether, if pay had actually been reduced, the outcome might have been different.
This decision broadly reaffirms existing decisions but is a helpful reminder that employees should check their contracts and handbook before accepting work so that, even though they may be in no position to vary the standard terms on offer, they do at least know what they are letting themselves in for. Employers can note that well crafted contracts/ handbooks may give them more scope to change terms than they may think. To a significant extent, however, it is always a matter of degree how much and how extensive change can be made and it is worth bearing in mind that Asda had included the provision in the handbook allowing changes in order to reflect “changing needs of the business”. The change in this case was to satisfy a legitimate business need (rationalisation of terms) and not based on a mere whim.
