Salary Deferral Agreement Uk
Another approach would be for your employer to terminate your employment contract by terminating you contractually and immediately offer you a new contract at a lower salary. You could then re-apply for wrongful dismissal, even if you have accepted the new contract. The Director appealed the ET ruling that there was no unlawful wage deduction. He submitted that if there was a contractual obligation (as the ET had found) to pay him his deferred wage in the event of termination, it would necessarily result in his deferred salary having to be properly paid on a given basis (i.e. in the event of termination) for the purposes of his wage claim. His right to a salary should therefore be successful. Employers can only change the contractual terms of employment of a worker with the agreement of the worker. This letter on the agreement on reducing wages as an alternative to redundancy aims to reach agreement on a reduction in wages as an alternative to a redundancy programme. For example, it can be used by an employer facing a decline in activity due to the onset of coronavirus (COVID-19).
If the employer makes adverse changes without the worker`s consent, there is a risk of infringement, unlawful deductions or an unjustified claim to dismissal. However, he stated that he could recover $25,000 of his deferred salary in compensation for the breach of his contract, as it was an unpaid contractual amount owed to him at the time of termination of his employment. Companies that enter into an agreement with a manager or worker on the deferral of their pay should ensure that the agreement specifies whether unpaid arrears should be paid contractually in the event of the individual`s termination or that they may benefit from an illegal wage deduction. Yes, you might agree, and your employer can agree. However, it is difficult to force your employer to accept that there will be a redundancy if they do not see it that way. In any case, the redundancy test should be performed (i.e. your role is no longer necessary). Your employer, on the other hand, may have the attitude that your role is still necessary, but your current salary is not affordable. It is more likely that your working time will be reduced and the question of whether there has been a flexibility clause in your employment contract to allow for an amendment will be relevant in this regard. The letter informs the worker of the amount of the proposed salary reduction and the effective date of the amendment.