Communications to employees about pay changes

31 July 2014

The recent case of Hershaw and others v Sheffield City Council is a timely reminder to employers to be careful about how and what they communicate to their employees, particularly with regards to pay.

Shoosmiths report that “the case stemmed from a decision by Sheffield City Council to vary the pay ofa group of market patrol officers following implementation of a Single Status pay and grading review.

As a result, the group of employees accepted the variation (which resulted in lower pay) under duress and raised an internal appeal. However, no outcome to the appeal was ever sent to them and their pay did not change. The group therefore raised a formal grievance.”

We are grateful to Lexis for their analysis of the decision:

The Employment Appeal Tribunal decided that, contrary to what the employment tribunal had decided, the document sent to the employees by the employer local authority regarding the change in their pay was capable of being a contractual document which, unless vitiated by obvious mistake, had expressed terms and conditions which had been acted on and accepted by the employees to whom it had been addressed. Accordingly, the employees' appeal against the tribunal's rejection of their claim for unauthorised deduction from wages would be allowed and the matter would be remitted to a fresh tribunal to consider whether mistake had vitiated the contractual effect which the document would otherwise have had.