Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Employment contractsPay settlements

Pay freeze upheld despite verbal assurance that increases were automatic

by Susan Dennehy 13 Oct 2014
by Susan Dennehy 13 Oct 2014

An Equality and Human Rights Commission (EHRC) employee who successfully claimed for arrears for “automatic” pay increases, which did not materialise, has had the decision overturned at the Employment Appeal Tribunal (EAT).

Before taking up her post, Ms Earle spoke to HR about her pay. A pay structure was in place and HR reassured her that her pay would automatically increase, subject to satisfactory performance.

When the Government imposed a public-sector-wide pay freeze, the EHRC’s pay reviews were reviewed in line with Cabinet Office, governed by the Treasury pay remit guidelines. The pay freeze affected all salaries, except where there was a contractual obligation to make a pay increase.

Employment contracts – XpertHR resources

Draft a contract of employment

Implement a pay freeze

Ms Earle’s contract of employment contained an entire agreement clause that seeks to prevent statements not in writing from having contractual force, which expressly stated that the EHRC was not obliged to award a pay increase.

However, the employment tribunal upheld her claim on the basis that the clause provided for incremental pay increases up through the scale subject only to satisfactory performance. Moreover, HR’s verbal assurance that pay increases would be automatic was a pre-contractual statement, which was contractually binding.

On appeal, the EAT overturned the decision because, in these particular circumstances, the assurance given by HR did not override the express provision in the contract contained in the entire agreement clause.

The contract stated: “There is no obligation on the EHRC to increase the level of your basic salary at a review.” Therefore, a pay award was discretionary and any earlier understanding between the parties could not overrule a discretion contractually agreed. Although there was a pay progression clause, no timescale had been included. Performance was not the only criterion as the clause was wider and provided for other considerations.

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

Although there was no obligation to increase salary, the clause did provide a contractual obligation to hold an annual pay review. As a pay increase was discretionary, in the light of the pay freeze, it was not unreasonable for EHRC not to award a pay increase, therefore no damages were payable.

The implications of this case for employers are discussed further in the full case report on XpertHR.

Susan Dennehy

previous post
Tribunal watch: TUPE transfer leads to pay cut for care workers
next post
Sex discrimination against men: 10 ways employers could fall foul

You may also like

Pay awards in real terms could fall for...

21 May 2025

Ryanair demands flight attendants pay back salary increase

21 May 2025

NHS Scotland staff accept two-year 8.2% pay deal

16 May 2025

Nurses threaten strikes if pay demands not met

12 May 2025

Zero-hours workers’ rights to be extended from beyond...

8 May 2025

Private sector median pay increases remain at 3.5%

6 May 2025

Bank holidays: six things employers need to know

2 May 2025

Employment Rights Bill must be tightened to protect...

1 May 2025

Public sector staff could be in line for...

28 Apr 2025

Confidence returning to jobs market, data shows

28 Apr 2025

  • 2025 Employee Communications Report PROMOTED | HR and leadership...Read more
  • The Majority of Employees Have Their Eyes on Their Next Move PROMOTED | A staggering 65%...Read more
  • Prioritising performance management: Strategies for success (webinar) WEBINAR | In today’s fast-paced...Read more
  • Self-Leadership: The Key to Successful Organisations PROMOTED | Eletive is helping businesses...Read more
  • Retaining Female Talent: Four Ways to Reduce Workplace Drop Out PROMOTED | International Women’s Day...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+