Chronicle EditorMatthias Ruziwa HR issues—
“Where there is no agreement, employers often impose changes unilaterally. This simply mean that you are in breach of the contract of employment. A party to a contract cannot unilaterally alter the terms and conditions of the contract in these circumstances”The Zimbabwean labour market is currently embedded with changes that occur to working relationships for all kinds of reasons emanating from the prevailing macro — environmental factors affecting the business community. Consequently, employers and employees are forced to adapt to the changes. The ultimate result is that the employment contract is subsequently affected. In some cases, employers unilaterally vary the contracts of employment and problems do arise. The varying of contractual terms is a complex legal matter and in this article, the writer will make an attempt to explain how contracts of employment can be varied.
A contract of employment is an agreement between an employer and employee which is enforceable by law. Regardless of the type, whether it is a contract without limit of time, fixed term contract, casual contract or seasonal contract, a contract of employment comes into being when an employee agrees to work for an employer in return for pay. Employment contracts that I have come across do consist of a mixture of express and implied terms. The distinction between the two terms is that express terms are those which are actually stated in writing or given verbally and are not restricted to written employment contracts but can include a number of other documents, such as a company policy document. Express terms must meet any minimum legal standards.
On the other hand, there are terms which are implied into contracts which may be due to works council agreements, collective bargaining agreements or by assumption that the term seems to have been agreed over a period of time. Good examples of terms that may be implied in your contract of employment include a duty of mutual trust and confidence between the employer and employee, the employer’s duty to provide a safe system of work and safe workplace, the right to receive at least a gazetted minimum wage, the right to a minimum period of notice (implied by statute) and equal employment opportunities for men and women.
There is a principle of law to the effect that employment conditions do not remain static. Contracts of employment will respond to the changes in the fortunes of business. See, Chirasasa v Nhamo N.O. & Anor 2003(2) ZLR 206(S) at 220B-C. Changed economic circumstances have caused employers from different sectors in Zimbabwe to reorganise and restructure their businesses. By so doing, contracts of employment have been varied in such areas like pay rates, hours of work, duties, relationships and places of work. I have come across a couple of disputes where employees have successfully claimed unilateral variation of employment contracts and at this juncture, I will highlight how best contracts of employment can be varied to avoid problems.
An existing contract employment can be varied only with the agreement of both parties or through collective agreement.
Changes to the contract may be agreed on an individual basis between the employer and employee or through collective agreement between the employer and employees` representatives.
When proposing to vary the employee`s contract, the employer should fully consult with the employee or his or her representatives and must explain and discuss reasons for the change.
Employees are likely to accept changes if they understand the reasons behind them and have an opportunity to air their views. Involving employees makes good business sense and it boosts their levels of motivation and engagement. Some employers offer incentives to encourage their employees to agree to the changes.
Variation to the contract need to be agreed in writing and such changes must be recorded and kept in the employee`s file.
Where there is no agreement, employers often impose changes unilaterally. This simply mean that you are in breach of the contract of employment. In the matter between Agricultural Bank of Zimbabwe Limited t/a Agribank v (1) Celemio Machingaifa (2) Chenjerai Mutambisi SC 61/07 , Garwe JA stated that “I do not accept that on the basis of para 11 of the contract of employment, the appellant was empowered to remove, without reference to the respondents, such a fundamental right as the entitlement to payment of a monthly mileage allowance. If the appellant’s argument were to be taken to its logical conclusion, on the basis of that paragraph, even the respondents’ salaries could have been reduced.
I do not accept that the bank in amending its policies and procedures was empowered to alter clearly defined contractual rights to payment of a salary and allowances. Such an entitlement could not be changed, altered or amended at whim on the basis that the appellant was entitled to change its policies and procedures from time to time. A party to a contract cannot unilaterally alter the terms and conditions of the contract in these circumstances”.
Some employers force unilateral changes in an effort to cause an employee to resign, or try and get an employee to toe the line. Under these circumstances, employees may make legal claims against the employer for constructive dismissal and may further claim damages for breach of contract at a labour tribunal. It should also be noted that unilateral variation does affect the morale and engagement levels of the concerned employee. It must be noted that a contract may contain express term which allow an employer to make changes to employees` terms and conditions. This unilateral variation clause is a clause which permits one party — usually the employer — to vary the terms of the contract without the consent of the other. In principle, this is lawful because the variation is already within the scope of the existing agreement. In essence, consent for the change has been given in advance. Unilateral variation clauses may range from fairly narrow terms — ‘The company reserves the right to review, revise, amend or replace the content of this employment contract, and introduce new policies from time to time to reflect the changing needs of the business and to comply with new legislation…’ The example term is clear and unambiguous and entitles the employer to implement the changes. In principle, it is not open to the courts to rewrite a contract entered into between the parties or to excuse any of them from the consequences of the contract that they have freely and voluntarily accepted, even if they are shown to be onerous or oppressive.
Disclaimer: Opinions expressed herein are solely those of the author. Matthias Ruziwa is an experienced Arbitrator and progressing Strategic Human Resource Practitioner based in the Midlands Province, City of Kwekwe. You can contact Matthias at the following email address:[email protected] /whatsapp 0773 470 368
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