Employment Rights Act - Coursework Example

Business Law What role does the implied terms and collective agreement play in the formation of terms and conditions applicable to the contract of individual worker? Discuss. Introduction The contract of employment is a lawfully binding accord between the employer and the employee thus bonding both the parties. Neither of the party is permitted to change the terms and conditions of the contract without getting the consent of the other party. This is the point to begin when any employee is being represented in any conciliation with regard to the agreement of employment (Todd, 2010). But sometimes there may be situations wherein the terms may have to be changed. For instance newer modes of working may be introduced, the current shift system may be changed or even new pay strategies may be introduced etc. On the part of the employees there may be changes like alteration in working hours for the sake of some domestic obligations (Todd, 2010). Some alterations are carried over by mutual consent like rise in salary. But it becomes difficult when the employer wants to alter the contract and the employee does not give his consent (Todd, 2010). Alterations to the terms and conditions of an employment contract normally amounts to breach of the Equal Pay Act, Discrimination legislation, Working Time Regulations and National Minimum Wage Act as well as sometimes it involves a TUPE Transfer which has to be specifically considered (Todd, 2010). Employment contract Put normally, the contract of employment refers to a relationship of economic dependency and social subordination. According to Kahn-Freund (1978. pp.508-528) an influential labour lawyer, "the relation between an employer and an isolated employee or worker is typically a relation between a bearer of power and one who is not a bearer of power. In its inception it is an act of submission, in its operation it is a condition of subordination, however much the submission and the subordination may be concealed by the indispensable figment of the legal mind known as the contract of employment. The main object of labour law has been, and... will always be a countervailing force to counteract the inequality of bargaining power which is inherent and must be inherent in the employment relationship." Employment contract if altered An employment agreement will not essentially be in writing. On the other hand an employer must furnish an employee with a written statement of details of employment after 1 month of the commencement of their employment. Even though such a statement does not amount to a contract of employment but still it is frequently denoted to in that way. It is nevertheless strong proof that certain conditions have been accorded between the parties particularly when it has been signed by the employee (Todd, 2010). According to s1 and 4 Employment Rights Act 1996, if any of these particulars are consequently altered the employer is indebted to furnish the employee with written notice of any such alterations within one month of the alteration. With reference to the above issue it has to be noted that s.38 of the Employment Act 2002 renders that in most Tribunal dealings, if the Claimant is unbeaten at a Tribunal Hearing and it is also established that, at the date of the commencement of the proceedings, the employer had neglected to give a written statement of particulars ‘including a failure to give an amended statement,’ and if any of those particulars have been modified the Tribunal is to honour an additional 2 or 4 weeks pay except for any special conditions making it unfair or unjust to do so. Implied Terms The hub of most employment agreements is wages for work. Indispensable conditions might be notice periods in the episode of dismissal, rights to holiday pay and the place of work and pension strategies. Many jurisdictions demand these elements to be written.1 Sometimes the terms may be express while sometimes it may be implied. Such terms need not be specifically stated for instance; a. Responsibility to provide with a safe working environment to the employee by the employer; b. Duty of reciprocal faith and trust; c. Terms which provide the contract with‘business effectiveness’ like a driver holding a legitimate driving license; d. Terms which can be inferred from the tradition and exercise of the business or industry; and e. Terms that can be rationally derived from the behaviour of the parties. In Wandsworth London BC v. D’Silva2 the Court of Appeal alleged that the terms of an employer’s Code of Practice on staff illness, with regard to the number of days sickness absence had to be reviewed and the employee’s absence record was changed, was not a condition of the contract of employment and so could be one-sidedly changed by the employer. When the words of the provisions which the employer desired to modify was analysed in the setting of the Code of Practice it was clear that those provisions were not an apt basis on which to establish contractual rights. The provisions of the Code of Practice only furnished direction to supervisors as to what could be anticipated to occur. Thus the Court of Appeal adjudged the terms were planned to be compromising and cosy in a way that was not in agreement with contractual rights being made. On the other hand workplace conventions and policies, like the ones in staff handbooks can at times attain contractual effect (Todd, 2010). In Keely v Fosroc International Ltd3 the Court of Appeal adjudged that a clause in a staff handbook furnishing that employees with 2 or more year’s service were allowed to a better dismissal payment established an enforceable contract term. In this case the court stated that the point to be considered were the language of the provision. In addition it also stated that a provision which is concerned with the remuneration package of an employee is a term of contract because it is a very crucial part of the complete bargain. Provision for dismissal payment is now an extensively consented characteristic of an employees pay package and, thus is specifically pertinent for inclusion by reference. The same conclusion was also reached in the case of Harlow v Artemis International Inc.4 Implied agreement There are situations where accord may be implied from the behaviour of the parties. For instance an employee one-sidedly changing the terms and conditions and then enforcing it on the employee and under the circumstance the employee continues to work under the employer without objecting to the new terms and conditions then it becomes an implied agreement. The employer can argue that the employee had impliedly agreed to the alterations. In these conditions it will not result to breach of contract. In GAP Personnel Franchises Ltd v Robinson5 an employee had a contract of employment stating that he had the right to claim 25p per mile for fuel disbursements. But when he received his first month’s disbursals he was informed that hence forward the employee could claim only 15p for the next 6 months till he left the employer. The employee brought a claim for breach of contract and illegal deduction from wages but the EAT adjudged that the employee had not disapproved to the modification and agreed that after the first month, his assent implied the term had been legally changed. The Courts are normally reluctant to find that employees have accepted to a modification in their contract where the agreement is not communicated expressly as was the situation in Jones v. Associated Tunnelling Company Limited6. This is predominantly so where the deviation has no instantaneous practical impact, for instance a mobility clause, (Aparau v. Iceland Frozen Foods plc 1996). The narrative of the current confidence and trust implied term reasonably commences with Western Excavating (ECC) Ltd v Sharp.7 The issue in the case was whether an employee maintaining violation of a statutory "right not to be unfairly dismissed", by a positive removal from office had to demonstrate that the employers behaviour was repudiatory or only irrational. The Court of Appeal adjudged that repudiatory behaviour had to be established if the employee were to deliver the goods. Lord Denning MR ascertained that the "unreasonable conduct test was too indefinite by far". In the above case Lawton LJ observed that: “For the purpose of this judgment, I do not find it either necessary or advisable to express any opinion as to what principles of law operate to bring a contract of employment to an end by reason of an employers conduct. Sensible persons have no difficulty in recognising such conduct when they hear about it. ... I appreciate that the principles of law applicable to the termination by an employee of a contract of employment because of his employers conduct are difficult to put concisely in the language judges use in court. Lay members of industrial tribunals, however, do not spend all their time in court and when out of court they may use, and certainly will hear, short words and terse phrases which describe clearly the kind of employer of whom an employee is entitled without notice to rid himself.” Collective Agreements Collective agreements are the 3rd mode of altering a contract in the employment statement. If in a particular industry there is a recognised trade union then alterations to the terms and conditions of employment must normally take place by way of collective bargaining. If the modification in terms and conditions is bargained with a trade union, a concern develops with regard to the agreement accomplished with the trade union has the consequence of altering the conditions of the individual contract of union members and of others in the labour force. There are two situations when this may take place (Todd, 2010):- i. Agency-if the union is representing the employees as agent then anything the union concur is viewed as to have been accorded between the employee and employer; or ii. Collective Agreements- in case there implied term in the employee’s contract comprising agreements made amongst the employer and the union. An individual is bonded by the change to the terms and conditions in the contract of employment agreed between an employer and a trade union, when the trade union acts as the employee’s agent in bringing off the change. This is uncommon. The law of agency calls for a positive action at law by the employee, which either specifically or impliedly nominates the union as his/her agent or admits the union as such. With an employee membership alone agency cannot be inferred (Todd, 2010). Collective Agreements are not generally enforceable between the parties negotiating them. If it has to be so, then it has to be expressly stated and such a situation is very rare. On the other hand, when such agreements are integrated into individual contracts of employment they are legally enforceable as between employer and employee Robertson v. British Gas Corporation.8 Once a condition in a Collective Agreement has been integrated into an individual contract, it continues to be integrated, even if the Collective Agreement itself is ended. Conclusion In the present climate trade unions are progressively more probably to become occupied with employers who are attempting to make alterations to gnaw at terms and conditions. Whether a legal redress is accessible will reckon on the particulars of each case. Regrettably the law does not make the Courts and Tribunals the most comfortable area in which to represent members’ terms and considerations when an employer is looking for altering them and a legal test is no alternative for industrial heftiness. Nevertheless there are controversies that have to be put forward, and even in conditions where such debates may not bring home the bacon in Court or Tribunal, they have to be set in the strongest potential terms in any internal conciliation. Reference Employment Rights Act 1996, s1 and s4 and s38 Otto, Kahn-Freund. 1978. ‘Blackstone’s Neglected Child: The Contract of Employment’ 93 Law Quarterly Review: pp.508 28. Todd, Neil. "Scenarios and Solutions." www.ier.org.uk/node/449. N.p., 23 MARCH 2010. 14 Apr 2010. Read More