07841706203 louise@watersidehr.uk

Changes to terms and conditions have been particularly common over the last year and British Gas have recently been in the news over their changes to terms and conditions.  If you are considering dismissal and re-engagement on new terms and conditions, what do you need to consider?

Communication and consultation

Communication and consultation are crucial to implementing changes to terms and conditions.  It can be useful to have an incentive to encourage employees to agree to the change if possible.  Larger employees will need to follow collective consultation rules if they are proposing changes to over 20 employees.

If someone won’t agree to the changes then one option is to dismiss them from the old contract and re-employ them on the new contract.  However, before you get to that stage you need to be able to demonstrate that you have engaged in consultation and have attempted to reach agreement regarding the change.

If you need to go down the dismissal route, what else should you be able to demonstrate?

Sound Business Reason

You must have a clear business reason for the change and not something decided on a whim.  The change does not have to be essential or crucial to the survival of the business, but an employer must be able to demonstrate with evidence the business reasons for the change and that these aren’t trivial.  They should demonstrate that the reason for the change is beneficial for the business.

That the dismissal was reasonable

You should have consulted with employees.  However, if the change means that the employee will be worse off it will not make the dismissal unfair.  You must show though that your approach has been reasonable throughout.  Your approach doesn’t need to take into account reasonableness on the impact of the employee to the change but you should be able to show that your approach to the process has been reasonable.  If an employee finds the offer unreasonable, it doesn’t mean that you as the employer are acting unreasonably.  You need to consider the employee’s reason for rejecting the change, whether they had reasonable notice, whether alternatives have been considered, that you have considered the impact on them, that you have tried to reach agreement and whether others have agreed the change if relevant.

If you are considering dismissal and agreement cannot be reached, then try and exhaust all other avenues first the subject of dismissal is broached.


To show that a dismissal is fair you need to have a fair reason, procedure and the decision to dismiss should be reasonable.  You will need to consider whether the dismissal is due to ‘some other substantial reason’ or whether there is a redundancy situation (the work has diminished or will cease or will be in a different location).  Consider if the terns you are offering are a ‘suitable alternative’ if it is a redundancy situation.  Seek advice where required as always there isn’t a one size fits all approach! I would also encourage you to document action take and reasons for decisions at all points.  Evidence is key.