Ensure compliance when changing your employees’ employment terms & conditions with this change of contract letter template. An employment contract amendment letter is a letter that tells your employee what it is you are changing in their employment agreement and why following the consultation process.
It’s a legal document to ensure you have the employee’s written consent, to make a proposed change to their terms & conditions. In it, you’ll set out the change you want to make, and the impact this will have.
If you need help with changing an employment contract, get in touch with one of Croner's contract and documentation experts here.
Do employees need an employment contract?
Employers are required by law to offer their employees a written statement from day one of their employment. The written statement will outline the main terms of their employment.
You must include the following pieces of information As per the Good Work Plan April 2020 whereby the government outlined what must be within a contract of employment.
- Name of employee and employers.
- Job title.
- Start Date.
- The date that continuous employment started.
- Place of work.
- Details about pay.
- Holiday entitlement, sick pay, probationary period and notice period.
- Hours of work.
- Paid leave entitlement.
- Company benefits.
Whilst there isn't a legal obligation for employment contracts to be a physical document, there is for the wider written statement.
Employers should remember that it's considered best practice to have a written employment contract and have the employee sign it. This helps to avoid confusion later on and gives both the employer and employee something to refer to should they need to.
Why would I need to change my employee's employment contract?
There are several reasons why you would need to change an employee’s contract. Any changes can be from an employer, or an employee can make a request for a change in their contract of employment.
Reasons that employers would need to change employee contracts could be;
- Change an employee's working hours (if your business needs to reduce their hours).
- If employees are being moved from a fixed-term contract to a full-time contract of employment.
- Their job title.
- Pay changes (minimum wage increases).
- Annual leave entitlement changes can include paid leave and public holidays.
- Changes to contractual benefits.
Changes to implement additional employee benefits such as;
- Employee Assistance Programmes (EAP)
- Contractual Sick leave and pay, or if they will only be entitled to statutory sick
- Change in notice period and probationary period.
- Employee health insurance.
Can an employee use this template?
No. An employee is legally entitled to request changes to their employment contract. This letter won’t help them do that.
They can request a change via letter or by speaking to their line manager. In cases where this results in a change in company policy, you must issue a letter confirming the change.
Employees may request that they want to adjust their working hours to fit better around their home life schedule, particularly if they have dependents. These changes would still need to be outlined in an employment contract change letter.
Can employers change a contract of employment without permission?
In short, no. If you make a change without permission from your employee or their trade union it is a breach of contract.
Even if in your employment contract you have a clause that states you can make minor changes, you still need to go through the consultation process with your employee before the change is made.
Why do I need an employment contract amendment letter?
An employment contract amendment letter is an employer's way of informing their employee of the changes that they've made.
When you are adapting a contract of employment, you need to reach an agreement with your employees. Once you've reached a conclusion on the changes, you should send employees a contract letter that outlines what was discussed and when the changes come into effect.
This letter will formalise what changes will be made to the employment contracts and should be filed with the employee contract. The employee should also receive a copy of the letter for their own records.
The contract change process
Before you make any changes to your employee’s contract, you need to follow a certain process.
- Speak to your employees or representatives. In this discussion, you should outline the changes you want to make in their contract and why you are changing them. For example, if you are changing an employee's job title because they've been promoted, or moved teams.
- Offer details as to why the change is needed, this is the reason you're making the change. For example, if you have to adjust your employees working hours because of a dip in business or because of other business needs.
- Take into account other ideas. Take on the feedback given to you by your employees. They might be able to offer up alternative solutions that you hadn't considered previously.
Do I need to use this template?
If the employee agrees there is a variation clause in the employee’s contract you may not have to issue a letter. However, it’s best practice to do so.
Issuing a letter helps avoid confusion and allows the employee to prepare for the change.
If you don’t have a variation clause, you must issue a letter informing the employee of the change.
How to use this template
Issuing this letter alone won’t be enough to protect an employee working for you from constructive dismissal claims.
You have to follow the right process to ensure compliance. Seeking the agreement of the employee is a significant part of that.
You must give your employee reasonable notice periods too. A major change in employment will require much more than one week's written notice than a minor one.
If you expect an employee to relocate to the other side of the country, they’ll need a few weeks at least. A pay change, however, could take place within a week with no disruption.
Communication is key throughout the process. If either the employee or former employee understands and knows the nature of the change and the timeframe, they’re less likely to have a grievance.
What is included in this letter template?
This sample letter to amend the contract of employment agreement covers:
- The reason for making a change to the contract
- Details of the change to terms that you’re going to make
- Optional arrangements for consultation
It’s also important to note that this template is for use when you don’t have a variation clause.
Download your sample letter
Your sample letter to change the terms and conditions of employment is free to download. All you need to do is input your personal details and the relevant change to the terms & conditions.
REMEMBER: issuing this change of employment contract template alone will not ensure your compliance.
To protect yourself from claims of constructive dismissal or discrimination, follow a fair process. If you need further direction, don’t hesitate to speak to a Croner expert by calling 0800 470 2738
How Croner can help
A contract change may seem simple, but it can be fraught with risks. To ensure you don’t fall foul of them, you can seek the support of a Croner expert. We can help at all stages of the contract-changing process, offering 24/7 advice.
If you’re looking to make a change, or are worried about how a current one is going, speak to an employment law adviser today on 0800 470 2738
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