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Changes to contracts of employment – invoking variation clauses

06 March 2015

The recent case of Hart –v- St Mary’s School (Colchester) Ltd illustrates that even where the contract of employment contains a variation clause it must be clear and unambiguous to allow for unilateral changes.

Mrs Hart was a part–time teacher whose working hours were spread over 3 days. In implementing a new timetable, the School sought to require her to spread her working hours over 5 days.

The contract contained two relevant provisions. The first stated at clause 1.4:

"In the case of the Teacher on a part-time contract the fractional part will be notified separately and may be subject to variation depending upon the requirements of the School Timetable."

The second stated at 2.1:

“During School term time, except as may otherwise be provided for under clause 1.4 above, the Teacher shall work all School hours while the School is in session and at any other time (including during School holidays, at weekends and before and after the School’s normal starting and finishing times) as may be necessary in the reasonable opinion of the Principal for the proper performance of his/her duties.”

The School relied on clause 2.1 to unilaterally impose the new working arrangements. Mrs Hart resigned and claimed constructive unfair dismissal.

The Employment Appeal Tribunal agreed with Mrs Hart that clause 1.4 governed her employment as a part time worker and that its terms were so unclear and ambiguous that the School could not rely on it as a general right to vary the number of days worked. Any such power would anyway be subject to the implied term of trust and confidence and an employer who sought to invoke such a power to increase the number of days worked by a part time worker might breach that implied term. Clause 2.1 related in the first instance to full time staff because by reference to clause 1.4 it expressly excepted part-time teachers from the mandatory provisions relating to working all school hours while the school was in session. The EAT pointed out that a part-time teacher might still be required, by the second part of clause 2.1, to work outside school hours, but that was not the issue in this case.

The School was in breach and had repudiated the contract of employment.

Practical tip: both the Hart and Sparks cases discussed above illustrate the need for any general flexibility clauses that employers seek to rely on to unilaterally vary employment terms to be clear and unambiguous. The Courts have previously, in Bateman and others v Asda Stores Ltd, upheld a variation clause in a staff handbook that was found to be unambiguous, and gave the employer the right to vary both the contractual and non-contractual terms in the handbook. This meant that the employer could in that case lawfully change the payment terms to employees (pay being a contractual matter referred to in the handbook) without the employees' consent.

David Ludlow
Partner - Employment