Case law: Court rules on reasonableness of clause requiring employees to work in a new location
Employers should ensure that clauses allowing them to move employees to new locations are reasonable in the circumstances, or risk the court ruling they are unenforceable, following a recent ruling.
This update was published in Legal Alert - November 2017
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A company operated from two sites which were more than 30 miles apart. It announced the closure of one site and its intention to transfer employees to the other site.
The employees’ terms of employment contained a mobility clause stating: “The location of your employment is […] but the company may require you to work at a different location including any new office location of the company either in the UK or overseas either on a temporary or permanent basis. You agree to comply with this requirement unless exceptional circumstances prevail.”
One employee lived near the site that was closing and could get to work in 20 minutes. The commute to the other site would take him two hours. He, and another employee who was also affected, claimed redundancy and refused to turn up at the different site. They were dismissed for failing to obey a lawful instruction and claimed unfair dismissal.
The employer argued that the terms of employment were reasonable because:
- The other site was within the UK and therefore within the wording of the relevant term
- It was consulting with employees, both collectively and individually, to find out how it could help them with the change
- It was offering to contribute to the travel costs of employees who faced longer journeys as a result of the change, for six months
- It was also offering flexible working whenever possible, to reduce the problems faced by employees because of the change, and changing its hours so that employees with long journeys could finish earlier
- The closure was because of challenging trading conditions, and aimed at saving jobs
The Employment Appeal Tribunal found that the mobility clause was too wide to be reasonable, and had been unreasonably invoked by the employer. The employees had therefore acted reasonably in refusing to attend work at the new site, therefore their dismissals were unfair.
- Employers should ensure that clauses allowing them to move employees to new locations are reasonable in the circumstances or risk the court ruling that they are unenforceable
Case ref: Kellogg Brown & Root (UK) Ltd v Fitton & Anor UKEAT/0205/16/BA
Please note: An article published in the February 2017 edition of Legal Alert covered this case at an earlier stage in the legal process.
Disclaimer: This article from Atom Content Marketing is for general guidance only, for businesses in the United Kingdom governed by the laws of England. Atom Content Marketing, expert contributors and ICAEW (as distributor) disclaim all liability for any errors or omissions.