Q: Can an employer cut hours from 28 to 20 per week by making the employee redundant and then offering them a 20-hour contract?
Jun 10 2010
Answered by: Peter Done Ask a question
Where you find that you need to make changes to the way your business works, and you decide that a reduction in your employees’ working hours is required, it does not necessarily mean that a redundancy situation exists and there are other methods by which you can obtain the same result.
If you require a reduction to 20 hours per week only as a temporary measure, you can place the employees on short-time working as long as you have reserved the right to do this in their contract of employment. However, there are limited circumstances where you can take this action even if it isn’t an expressly agreed term. When business picks up again, the employees would then return to a 28-hour week.
Alternatively, if you need to make a permanent change to working hours from 28 to 20, you will need to gain the consent of the employees involved because it is a change to their agreed terms and conditions in their employment contracts.
It may already be apparent to your workforce that the business is experiencing difficulties, i.e. the phone isn’t ringing and orders aren’t coming in at their usual high rate, and if this is the case, informing them that changes need to be made will come as no surprise. Many employees may well be prepared to reduce their hours of work if the only other alternative is to lose their jobs completely so there may well be no opposition to the change.
It is possible that there may be some employees who refuse to agree to the reduction. Ultimately, it is open to you to terminate their employment and simultaneously re-engage them on a 20-hour per week contract. This should be your last resort and all efforts should be made to agree terms with your employees because this is still a dismissal in the eyes of the law. However, if you have a solid business reason for making the changes, then you may well succeed in arguing the dismissal was fair.
Legal advice specific to your situation should always be sought when a change to employees’ terms and conditions are being considered.
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