Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • 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
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • 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
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

Pay settlementsEmployment contracts

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.

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.

Avatar
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

Inflation in May 2022 at 40-year high, as...

22 Jun 2022

Pay deals highest in 30 years, but outstripped...

21 Jun 2022

Rail strike: PM calls for pay compromise to...

21 Jun 2022

‘General strike’ threat looms as unions voice pay...

20 Jun 2022

CIPD Festival of Work: ‘Use crises as catalysts...

15 Jun 2022

Bolt drivers strike as union launches workers’ rights...

15 Jun 2022

Cost of living: real wages fall 2.2% in...

14 Jun 2022

Care workers to strike over ‘cruel’ fire and...

10 Jun 2022

Train drivers across three companies to strike over...

10 Jun 2022

Tesco appeal against fire and rehire ban to...

8 Jun 2022
  • NSPCC revamps its learning strategy with child wellbeing at its heart PROMOTED | The NSPCC’s mission is to prevent abuse and neglect...Read more
  • Diversity versus inclusion: Why the difference matters PROMOTED | It’s possible for an environment to be diverse, but not inclusive...Read more
  • Five steps for organisations across the globe to become more skills-driven PROMOTED | The shift in the world of work has been felt across the globe...Read more
  • The future of workforce development PROMOTED | Northumbria University and partners share insight...Read more
  • Strathclyde Business School expands its Degree Apprenticeship offer in England PROMOTED | The University of Strathclyde is expanding its programmes...Read more
  • The Search for Talent: Six Major Employer Pitfalls PROMOTED | The Great Resignation continues unabated...Read more
  • Navigating the widening “Skills Confidence Gap” in 2022, and beyond PROMOTED | Cornerstone OnDemand conducted a global study...Read more
  • Apprenticeships are the solution to your recruitment problems PROMOTED | Apprenticeships have the pulling power...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 2022

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2022 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • 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
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+