Q: If we need to reduce employee hours do we need to change the contracts?
Feb 02 2009
Answered by: Peter Done Ask a question
You cannot just change employees’ contracts irrespective of the change you wish to bring in or the reasons for it. You will only be able to enforce a reduction in your employees’ hours if you have a contractual clause in place allowing you to do this.
If you now have fewer hours’ work than you did before, you are in a potential redundancy situation and you need to act accordingly.
You need to consult with your staff about your current situation. Discuss with them if this is a short-term reduction in hours to get over a short blip or a more permanent change. Explain to your staff what you are trying to achieve and discuss the different methods of bringing this about. Some people may be willing to reduce their hours and agree a change to their contracts, others may not be able to do that due to financial commitments.
What is the reduction in hours is intending to achieve? Is it that you need the same number of people, but not over the same hours of the day or is that you have less work across those hours? In the first instance then you would seem to have some initial basis for arguing that you can no longer maintain the existing contracts and need to look at replacing them with new contracts for fewer hours. In the second situation then you would have to seriously consider redundancy as a real alternative.
If you are in a position where you can no longer continue with the existing contracts then you have an option to dismiss and offer re-engagement on the new terms. However, this is a dismissal and potentially a redundancy situation and you would need to follow the statutory procedures to ensure that any dismissal is fair.
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