Variation of Employment Contracts

Varying a contract of employment must be handled carefully to  maintain legal compliance and good employee relations. 

What is the procedure for varying terms of employment?

Identify and clarify the need for change (e.g. business restructure, role change, pay adjustment, location move, working hours) and check the current employment contract for any additional flexibility, such as variation or mobility clauses.

Consult with the employee, explaining the business reasons and potential impact (collective consultation required for 20 or more employees); allow employees to raise concerns, propose alternatives or seek clarification; retain consultation records (or minutes of meeting) and any correspondence explaining the proposed changes. 

Any agreement must be by mutual consent and recorded in writing. If the employee(s) disagree, options start at further negotiation to termination or re-engagement - legal advice should be sought for such latter outcomes.

Once an agreement has been reached, download and edit/complete the Variation Of Employment Contract Letter with details of the agreed amendment(s) to the employment terms. This is a generic template which can be applied over a broad range of changes to employment contracts. Alternatively, or in addition to this letter, provide a revised contract of employment. Download up-to-date templates from the Contracts of Employment selection.

The generic variation letter is supplemented by a range of other templates that cover common specific changes to employment terms:

• The Alternative Work Offer Letter should be applied where an employer seeks to find an employee a position more suitable to the employee's current circumstances.
• The 48 hour Working Time Directive Waiver should be applied when a opt-out clause has not been included within the contact of contract of employment and must be voluntary. Guidance Notes are also provided to help employers comply the Working Time Regulations 1988.
• The Possible Relocation of Business Premises Letter provides for explanation of the reasons for a proposed move and the employer's wish to consult with employees. If the relocation is significant the employer must consider at an early stage their reliance on the mobility clause or considering/commencing a redundancy procedure. If in doubt, professional legal advice should be sought.
• A selection of pay related letters covering national minimum and living wage, a Salary Sacrifice Letter providing for salary reduction in exchange for a non-cash benefit, and Salary Reduction as Alternative to Redundancy Letter  which is most commonly used where businesses are facing a downturn in business.
• A selection of Sunday Working letters.

Please view the full choice of these Variation of Employment Contract templates below:

• Variation of Employment Contract Letter
• Alternative Work Offer Letter
• Letter Confirming Employment Contract has been Updated – Initial
• Letter Confirming Employment Contract has been Updated – Follow Up
• 48 Hour Working Time Directive Waiver
• Guidance Notes – Working Time Regulations 1998
• Letter Advising Employee of a Possible Relocation of Business Premises
• Letter Advising Worker of Pay Rate Increase Due to Moving to a Higher Age Band of the National Minimum Wage
• Letter Advising Worker of a Pay Increase Due to a Rise in the Rate of the National Minimum Wage
• Letter Advising A Worker of Pay Rate Increase Due to Moving to the National Living Wage
• Salary Sacrifice Letter
• Letter Seeking Agreement to Salary Reduction as Alternative to Redundancy
• Overpayment of Wages Letter
• Letter Advising a Worker of the Right to Opt out of Sunday Working
• Letter Acknowledging Sunday Working Opt-out Notice from Shop Worker
• Letter Requesting Details of Work Done for Other Employers

Variation of Employment Contracts is part of Employment. Just £38.50 + VAT provides unlimited downloads from Employment for 1 year.