Employment contract replacement?

[Chris1986]

Hi all,

got a really annoying this happening at work. I’ve been sent a completely new contract of employment. Most of the minor stuff is the same - reporting sick, place of work etc etc. However there’s quite a few big changes. One thing that’s been written in, is that I give full permission for the company to make any deductions from my wages that they see fit. They’ve given a few examples, like damaging equipment due to negligence, which I can understand, but they do state that the list is not exhaustive.

another is that I wave any moral rights to intelectual
property such as ideas, methods, inversions and processes.

The biggest change is that they’ve added, and is. Is the biggest section in the contract, a non compete clause, and its ruthless!! I’m an engineer by trade, currently working as a generator service engineer. The non compete basically says that I can’t work for a competitor, a client, or a customer for 12 months after the date of my employment terminating. The restricted territory - 10,20,30 miles?? Oh no, the restricted territory I’m not allowed to gain employment in is ENGLAND, IRELAND, SCOTLAND & WALES!!! How on earth can they be trying to get away with this?! It’s been sent out to every employee and called a ‘contract harmonising process’ and I think they’re hoping most people won’t notice the changes.

Also, I think they’re trying to pull a fast one on me getting me to sign it quickly, I’m known for picking through stuff like this. The contract they’ve sent me has the wrong salary on it, and my boss has immediately sent a follow up email to inform me of this (the salary is a little more than what I’m on). He says he’s going to check with wages what I’m in and then send out a revised contract, but my thinking is he wants me to sign it with the pay increase on because they’d presumably have to honour it.

My main question now is, can they force us/me to sign this new contract? I’ve heard rumours that a few of the office staff haven’t, and they’ve been told that they’re existing contracts will be cancelled(?) but I don’t know how true that is. I strongly object to the new contract, mainly the non compete, as it clearly means if I leave my current position, I’ll have to move industry!! They’re recommending electronic signatures be used as there’s very few clerical staff working in the office, part of me is expecting them to forge my name on one of these new contracts, but only
rime will tell.

What on earth should I do now with regards to rejecting this contract??


thanks for reading my essay

[ULA]

Does your exisiting contract allow for your employer to vary the terms and conditions?
Are you a unionised workplaces? In which case contracts may provide for terms to be varied by union agreement. For the employer not to need individual employees’ consent to contract changes, it must be very clear that union agreements are incorporated into individual contracts.

However if none of the above apply in your situation then your employer needs to follow a fair process to implement a significant change in your terms and conditions if they do not want to face a claim for breach of contract. From what you have detailed this in my opinion would be considered a significant change in which case they need to fully consult with you and agree any changes.

If you do not agree the law does recognise that employers have to adapt to changing market conditions, and that sometimes the contract of employment must be varied to reflect this. If your employer has given reasonable and due consideration to objections and alternative suggestions that you put forward, but deem those suggestions to be unworkable, then they can terminate your original contract and offer a new one in its place on the new terms and conditions.

If you do not agree to the changes, then you must make it clear to your employer. You should do this in writing, sign and date your letter, and keep a copy. This letter will count as a written grievance. If you do not tell your employer you disagree with a change, this will be taken to mean that you have accepted it. You should do this straight away, or as soon as possible after the change has been introduced.

You can continue to work 'under protest' for a while but you cannot do this indefinitely without taking further action. This may mean making a claim to an employment tribunal, or, in some extreme situations, resigning from your job and claiming "constructive unfair dismissal".

If you do not want to do either of these things, you may eventually have to accept the changes to your contract. There are strict time limits for making a claim to an employment tribunal.

Just on the issue of the restricitive covenant given how restricitive, in my opinion, it sounds like it is potentially too restrictive any may not stand the test of a court -but that is only my view.

[Chris1986]

Thanks for the reply, my existing contract says they have right to make any reasonable changes to any of the terms of my employment, but this isn’t just a change this is an entirely new contract - albeit based on my existing one. I’m part of a union, but the company don’t recognise it and won’t give them any time really. For example, I had a fairly big grievance over the summer re working hours. I followed their procedure. They granted me a ‘friendly chat’ but after that they decided that I didn’t have grounds for a grievance and therefore I wasnt allowed a formal meeting to discuss, so my union rep couldn’t get involved, they just told me to shut up. They’re such cowboys!! What frustrates me is that they get away with it all the time! I don’t want to leave, as the job suits me perfectly at the moment. But if they enforce this contract on me, I don’t think I’ll have any choice but look elsewhere.

[ULA]

From what you have said about the chnages they want to make it will be a determination of whether they fall under the "reasonable change" clasue in your exisiting contract.

Given that the company does not recognise a union then the consultation that the company is required to undertake in attempting to gain agreement to the contractual changes needs to be carried out on an individual basis.

[Chris1986]

So, how do I disagree with the proposed contract then? Because they’ve just sent me it and told me to read it and sign it.

[islandgirl]

I have no idea what you can do legally but in your position I would put in writing that I am happy to sign it if the following unreasonable clauses are removed...You will not know if that is possible until you ask. This is not advice, just what I would do!

[Chris1986]

For anybody who wants to have a bit more of a look, here’s the main addition to the contract.

21. Post-Employment Covenants
21.1 You acknowledge that during the course of your employment under this agreement, you will be provided with access to Confidential Information relating to the Company and the Group and its affairs and have dealings with the customers, suppliers and employees of the Company and the Group in such matters. You therefore agree to the restrictions set out below.
21.2 In this clause 21 the following expressions have the following meanings:
Confidential Information
as defined at clause 20.2;
Critical Person
any person with whom you were directly concerned or connected and with whom you had personal knowledge who is or was an employee, agent, director, consultant or independent contractor employed, appointed or engaged by the Company or any Relevant Group Company at any time within the Relevant Period who by reason of such employment, appointment or engagement and in particular his/her seniority and expertise or knowledge of trade secrets or Confidential Information of the Company or any Relevant Group Company or knowledge of or influence over the clients, customers or suppliers of the Company or any Relevant Group Company is likely to be able to assist or benefit a business in or proposing to be in competition with the Company or any Relevant Group Company.

Relevant Customer
any person, firm, business, company or organisation who or which at any time during the Relevant Period is or was a client or customer of the Company or any Relevant Group Company for the sale or supply of Relevant Products or Services, and in each case with whom or which you had material contact or personal knowledge during the Relevant Period in the course of your employment hereunder;
Relevant Group Company
any Group Company (other than the Company) for which you have performed services under this agreement or for which you have had responsibility at any time during the Relevant Period;
Relevant Period
the period of 12 months immediately before the Termination Date during which you actually performed your duties in accordance with this agreement, or (where such provision is applied) the commencement of any period of exclusion pursuant to clause 17 if earlier;
Relevant Products or Services
products or services which are of the same kind as or of a materially similar kind to or competitive with any products or services manufactured, sold or supplied by the Company or any Relevant Group Company within the Relevant Period and with which manufacture, sale or supply you were directly concerned or connected during the Relevant Period in the course of your employment hereunder;
Relevant Supplier
any person, firm, business, company or organisation who or which has provided goods or services (other than utilities or administration-related supplies) to the Company or any Relevant Group Company during the Relevant Period and in each case with whom or which you had material contact or personal knowledge during the Relevant Period in the course of your employment hereunder;
Restricted Territory
England, Wales, Scotland, Northern Ireland.
Termination Date
the effective date of termination of your employment in accordance with the provisions of this agreement.
21.3 You will not without the prior written consent of the Company directly or indirectly and whether alone or in conjunction with or on behalf of any other person and whether as a principal, shareholder, director, employee, agent, consultant, partner or other capacity:
21.3.1 within the Restricted Territory for a period of 6 months from the Termination Date be employed, engaged, concerned or interested in or provide technical, commercial or professional advice to any other business which supplies Relevant Products or Services in competition with the Company or any Relevant Group Company provided that this restriction does not apply to prevent you from: (i) undertaking duties or activities which are materially different from those undertaken by you during the Relevant Period in the performance of your duties hereunder; or (ii) holding shares or other securities in any company which is a limited company, or is quoted, listed or otherwise dealt in on a Recognised Investment Exchange or other securities market and which confer not more than five per cent of the votes which could be cast at a general meeting of such company;
21.3.2 within the Restricted Territory for a period of 6 months from the Termination Date be employed, engaged, concerned or interested in any Relevant Supplier and/or do or attempt to

do anything which causes or may cause a Relevant Supplier to cease, alter or materially reduce its supplies to the Company (or any Relevant Group Company as the case may be);
21.3.3 within the Restricted Territory for a period of 6 months from the Termination Date be employed, engaged, concerned or interested in any Relevant Customer and/or do or attempt to do anything which causes or may cause a Relevant Customer to cease or materially reduce its orders or contracts with the Company or any Relevant Group Company;
21.3.4 for a period of 12 months from the Termination Date canvass, solicit or approach or cause to be canvassed, solicited or approached any Relevant Customer for the sale or supply of Relevant Products or Services or endeavour to do so;
21.3.5 for a period of 12 months from the Termination Date deal or contract with any Relevant Customer in relation to the sale or supply of any Relevant Products or Services, or endeavour to do so;
21.3.6 for a period of 12 months from the Termination Date solicit, induce or entice away from the Company or any Relevant Group Company or, in connection with any business in or proposing to be in competition with the Company or any Relevant Group Company, employ, engage or appoint or in any way cause to be employed, engaged or appointed a Critical Person whether or not such person would commit any breach of his or her contract of employment or engagement by leaving the service of the Company or any Relevant Group Company; or
21.3.7 use in connection with any business any name which includes the name of the Company or any Group Company or a name so similar to the name of the Company or any Group Company that it may cause confusion in the mind of a Relevant Customer.
21.4 Whilst
as you hereby acknowledges) are regarded by the parties as fair and reasonable, it is hereby agreed that each of the restrictions in this clause 21 are intended to be separate and severable. If any restriction is held to be unreasonably wide but would be valid if part of the wording (including in particular but without limitation the defined expressions referred to in clause 21.2) were deleted, such restriction will apply with so much of the wording deleted as may be necessary to make it valid.
21.5 The parties agree that the periods referred to in clauses 21.3.1, 21.3.2, 21.3.3, 21.3.4, 21.3.5 and 21.3.6 above will be reduced by one day for every day during which at the Company's direction and pursuant to clause 17 you have been excluded from the Company's premises and/or have not carried out any duties or have carried out duties other than your normal duties.
21.6 If you breach any of the provisions in this clause 21 the Company will be entitled by written notice to you to extend the period during which the provisions of this clause 21 which have been breached apply by an equivalent period to that during which the breach or breaches have continued, such additional period to commence on the date on which the said period would have otherwise expired. You hereby agree that if the Company so extends the period of any such restriction, this will not prejudice the right of the Company to apply to the Courts for injunctive relief in order to compel you to comply with the provisions of this clause 21 and/or damages, as the case may be.
21.7 For the purposes of clauses 20 and 21 the Company has entered into this agreement as agent for and trustee of all Relevant Group Companies and all Group Companies respectively.
21.8 If you apply for or are offered a new employment, appointment or engagement, before entering into any such contract or arrangement you will bring the terms of this agreement to the attention of a third party proposing directly or indirectly to employ, appoint or engage you.
the restrictions in this clause 21 (on which you have had an opportunity to take independent advice

21.9 The Company may at any time (before or after the termination of this agreement) modify the scope of the restrictions contained in clause 21.3 by notice served upon you reducing (but not increasing):
21.9.1 the activities to which the restrictions apply;
21.9.2 the employees of the Company or the Group covered by the restrictions; and/or
21.9.3 the period during which the restrictions apply; and/or
21.9.4 the scope of the Restricted Territory.

[ULA]

Its a long clause but then these oftern are and I have had a quick read through.

The restrictions on working for a competitor, a supplier, or a customer seem to be 6 months, not 12 as in your original post, however the 12 months relates to enticing away or contracting with customers or enticing away Critical Persons in the business. You may not want to hear this but depending on the industry you are in and the seniority of the position that you have in the company these are not unusual. However the one for me that is a potential issue is the Restricted Territory which seems to be very wide. The other questions that sits alongside this is about the transferability of your skills into another industry/sector - is this easy to do?

Even if the company believes this change comes under the "reasonable changes" clause it should still be a point of discussion explaining why it any anthing else is being brought into the new contracts. I would suggest that you arrange a meeting with your manager and/or HR as soon as possible to discuss the points of concern that you have.

[Chris1986]

These clauses have been rolled out across the entire company. The industry I’m in is back up power generation. I’m essentially a diesel mechanic, not like I’m some kind of nuclear scientist with extremely assertive knowledge. I’m a contractor. If I can’t work for a competitor, supplier or customer for 6 months (my mistake, I thoughg it as 12 months) then essentially I can’t stay in this industry. We operate through all the biggest Facilities Management companies in the country (Mitie, Interserve etc) and have some big contracts (MOD NHS Police Fire service) so I wouldn’t even be allowed to be linked to any of them, nor would I be allowed to work for any of the manufactures.

This evening I’ve been forwarded an email from our ‘team leader’ (another engineer who’s been given a tiny amount of authority) he claims he’s spoken to our service manager, and he claims that the contract has just been reworded, and that they won’t stop us from moving companies - I’m fairly sure that’s 100% not true given what’s outlined in the contract?

Sadly the company is noncompliant when it comes to HR. We have about 350 members of staff, and our individual HR personal just so happens to be in a duel role, his other role is the business support manager, so guess where his loyalties lay? I tried to put a grievance in earlier this year, they denied me a hearing and closed down my case, they said I didn’t have grounds to launch a grievance! I was allowed a ‘without prejudice informal chat’ with said manager & the service manager, who both had the same opinion and told me I was wrong!

I think they’re deliberately misleading us so that we sign it and it become legal, it’s a joke.

Just to clarify then, despite my ‘team leader’ being told to tell us that there’s no restrictions on our next employment, there absolutely is, and it’s the entire UK for 12 months?

[ULA]

My concern for you about the comment forwarded in the email from the "team leader" and in answer to the final point you ask in your post #9 for clarifiction is that - as I read it and it is only my opinion, clause 21.3 indicates that you need the prior written consent of the company to effectively have any/all of the restrictions in the 21.3 subclause 1-7 waived.

How likely is it that they will given that consent?

[Chris1986]

Thanks for all the responses so far everyone, this really is a wonderful place! The problem is, with my employer, they lie. They defend themselves so much that it boarders corruption sometimes!

Anyway, the update on this is that an announcement has been made, because so many people are unhappy about this stipulation. The chairman of the company has said that they’ve never stopped anyone moving in the past and that they wouldn’t ever stop anybody leaving in the future, and that they HAD to put this stipulation in the contract. What makes this an absolute joke, is that recently it was decided that all the big company announcements, would be posted on MS Teams! I’ve taken a screen shot of this on my phone to keep hold of just in case. But I’d they’ve got no intentions of keeping us to these terms, then why put it in the contract at all?!

[ULA]

Thanks for the update and well done on taking that screen shot as you say just in case!

Sounds like it was unecessary poor employee relationship management if they have "no intention" of making you adhere to the terms.

Best of luck