Changing the terms of employment
A contract of employment is a legal agreement between the employer and the individual employee and any changes to the existing agreement needs the employee’s consent.
Employers are generally required to treat employees with consideration and respect in contract negotiations. An Employment Tribunal will consider the conduct of the employer by the standard of the ‘reasonable employer’ facing similar challenges; whether that is reducing payroll costs or restructuring the business.
The case for engaging with employees is well established in management literature. Employees are only able to perform at their best if they understand their roles and rights and have opportunities to make their views known to management on issues that affect them.
Consultation is the critical tool to get the input of employees – it is employees who have the knowledge and experience of the detailed operations, the problems and the pitfalls, and how they might be dealt with to improve productivity, quality and customer service.
The employer should explain the proposed changes and take reasonable measures to reduce the negative impact on the employee. Discuss the reasons for the change and engage with the employee in considering the options.
Consider offering incentives for the employee to agree to the changes; buyout of the term of the contract (12 months loss of earnings) or trade off against another entitlement (increased holiday entitlement).
Collaborative problem solving
It is not enough to have regular meetings and provide loads of information. In dealing with difficult issues it is important to give employees an opportunity to understand the issues and express their views. The time spent in collaborative problem solving will improve the decision making process and gain understanding and commitment to the implementation of the change programme.
The key is to involve employees in analysis and problem solving and this process helps break down barriers and ensures that decisions are robust.
Change works best when employees are involved in the process they must understand why it is important to make the change and how critical their contribution is to the future success of the business.
Collaboration is challenging!
It is very demanding of individual managers in terms of their social skills and leadership ability – making a decision is intuitively preferable to seeking the views of others. Many managers prefer to feel in control they make excuses for rejecting or paying lip service to engaging with employees.
It is a major challenge to adopt a leadership style which is committed to keeping employees informed of how the business is doing and engaging them in decisions that affect them.
Effective engagement with employees could be the life blood of your business; it can be used to introduce difficult changes and improve productivity, flexibility and motivation.