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Bringing order to contract chaos

Global revamp of terms and conditions delivers consistency, fairness and value

I helped a diverse, international group to review and reorganise its whole approach to contracts of employment.

Contractual confusion

The UK-based group had grown by acquisition with little planned integration of new entities. When businesses were acquired, employees usually transferred under existing contracts of employment without a proper assessment of whether this was in the interests of employees or the company.

Over time, this became unsustainable as the company was obliged to uphold lots of out-dated practices and was running sizeable legal risk. As the company gradually centralised, some employees were starting to discover discrepancies in terms and conditions and complain of unfairness.

In addition, there was a piecemeal approach to senior executive agreements worldwide.

Working with the top team, I initiated a wide-ranging review aimed at standardising terms and conditions and senior executive agreements. This chimed with the company’s new strategy of finding synergies across divisions.

Assessing and addressing the problem

The review revealed:

  • 90 different contracts across the group, some of which made reference to handbooks that no longer existed but could have been viewed as contractual
  • variable terms and conditions with inconsistent notice periods and little control of areas such as gardening leave and confidentiality
  • senior executives with two concurrent contracts – one based on UK law and the other based on the law of the country they worked in
  • missing policies – including no drugs and alcohol policy in a unit where employees used heavy machinery and trucks
  • benefits that could be extended to all groups and benefits that had become counterproductive.

I facilitated a meeting of the top team and an independent employment lawyer. From this, we were able to develop a solution that addressed the issues uncovered by the review. We drafted a new handbook, new contracts for all UK staff and a new framework for senior executive agreements around the world.

I then led a three-month consultation with unions and the company’s employee consultation forum.

Resounding success

After the consultation, the unions wrote to members recommending they sign up to the new contracts and noting that they were satisfied with the process and the outcome (even though there were new policies that had generated resistance over many years).

The senior executive agreements were put in place worldwide, including for the chief executive. Meanwhile, there was 100% take-up of the new UK contracts across all units.

For the company, administration of terms and conditions became much more efficient and there was far less scope for confusion and contractual disputes.

All in all, a resounding success.