Legal

How to deal with contracts affected by Covid

22 Feb 2021 By Molly Dilling

Molly Dilling explains what employers should do when handling contractual changes such as short-term layoffs and flexible working requests

Covid-19 has resulted in a number of contractual issues being raised, many of which would have been entirely unforeseeable a year ago. It is likely that the employer’s business may have changed, whether that be down to the type, amount or scope of work that is required to be done. It would therefore follow that contractual amendments may need to be made, particularly in respect of job description, place of work and potentially hours of work.

The government guidance on contracts in general is that businesses should act responsibly, act fairly, support the response to Covid-19 and protect jobs and the economy. But how does this apply to employment contracts?

The first step when making any contractual changes will always be to communicate. It is imperative that employees are consulted before any changes are made, and consent should ideally be sought. Decisions should also be recorded in writing where possible. This is essential to ensure the business is protected in the case of any potential employment tribunal claims. 

In light of the uncertainty the pandemic offers, employers may be unsure as to when their business will pick up and whether it will dip once again. Organisations may want to consider, therefore, whether it would be sensible to include short-term layoff provisions, which allow you to release employees temporarily in the absence of workflow. Employers should note two points here however: first, short-term layoff should only be used when it is expressly provided for in the contract; and second, whether the employee can be furloughed under the job retention scheme .

Alternatively, for those businesses that are able to keep their employees on, they may be faced with a situation where some staff request for the place of work in their contract to be amended from the office to their home, or request flexible working, as per their statutory right. Employers are not obliged to accept these requests, but they are obliged to consider them and deal with them in a reasonable manner. 

It may be that you receive more than one flexible working request and, for business or economic reasons, you are not able to accommodate them. For example, if you had five employees requesting to work from home full time when you need at least one person working in the office on reception. In this situation, you should consult with the employees involved and make what you feel is the correct decision, ensuring you follow the Acas guidance and ensure that any decisions made are not discriminatory. As with every aspect of employment relations, ensuring that you communicate with your employees is essential.

Businesses should also ensure that the relevant policies and procedures for remote working are in place. For example, it’s important to consider policies that deal with health and safety at home, ensuring GDPR and data protection are complied with and that employees have the correct equipment. 

Another issue to think about is the obligations between employer and employee. How do you manage workload and performance? How do you ensure that employees stay motivated? The company sickness policy should be updated to include provisions for employees self-isolating. 

It’s also important to consider whether grievance and disciplinary policies should also be amended to allow investigations and discussions to take place remotely. On this point, employers may wish to think about the practicalities of this: do all the relevant parties have access to technology? Are there records and documents in the office that need to be obtained? And does the remote process still allow meetings to be carried out in a fair and reasonable manner?

There are of course many ways that employment contracts can be changed, but the advice remains the same. Communicate, act fairly and ensure that the decisions you make as an employer are reasonable and do not discriminate.

Molly Dilling is a trainee solicitor at Parker Bullen Solicitors

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