JSA / resignation query

tcr_3

My friend's employer are in a dire financial position & he's worried about a change the employees were told about today. (And this post is for a friend, it's not me !) ... he works in a small family run foundry, he's the office monkey, there's about 20 employees.

I don't know enough about JSA sanctions to advise him.

His contract of employment states that he starts on a salary minimum of £14,200 which rises to £18,400 after 5 years continuous employment. After 2 years employment he's currently on £15,200.

His contract also states he is entitled to an annual bonus payment as part of his wages (it's about £200 per year, payable in August).

His employer told all staff members that career progression increases have been cancelled for 2 years. The annual bonus has also been cancelled for the next 2 years. Nor will wages be increased for inflation for this year at least.

The staff were not consulted, nor were the union, it's simply being imposed.

Here's the arithmetic.

With progression ................................2 years without progression
14,200 .............................................14,200
15,200 .............................................15,200
16,000 .............................................15,200
16,800 .............................................15,200
17,600 .............................................16,000
18,400 .............................................16,800
18,400 .............................................17,600
18,400 .............................................18,400

135,000 ............................................128,600

Salary loss = £6,400
plus bonus loss + £400
Total loss = £6,800 (less tax etc)

2 yrs marking time doesn't sound too much, does it, but when he adds it up it's a huge amount of money.

He's not much better off for working,tbh. Last time he was unemployed he got £450 pcm from HB for his rent, £100 pcm for his Council Tax and approx £290 for his personal benefit ... working full time he's only bringing in about a grand. So it's not like he'd lose much if he packed his job in.

(I've told him he's maybe better taking the hit ... and staying with the company ... but the M.D. has seemingly just bought a new holiday home in the Canaries and taken delivery of a £100,000+ Merc, emotions are running high and the guys are seemingly ready to walk out on a wildcat strike tmorro, against union advice).

Can I ask ... would this be classed as a "breach of contract" on the part of the employer ? And if my mate does choose to resign, would JSA sanction him for doing so ?

Merci beaucoup !

suelees1

As far as JCP is concerned if he gives up work the likelihood is that they will impose a sanction of up to 26 weeks.

I'm completely out of touch with employment law these days but surely the union should be able to advise them all about that. Alternatively tell him to contact ACAS

dookar

A person cannot show Just Cause for leaving voluntarily if their only reason is rate of pay

themonkeybutler

tcr wrote: »

His employer told all staff members that career progression increases have been cancelled for 2 years. The annual bonus has also been cancelled for the next 2 years. Nor will wages be increased for inflation for this year at least.

Exactly the same thing has happened in the civil service (as you may have heard!). Sadly, if i left my job stating it was because David Cameron and co had frozen all my pay for 2 years, the Job Centre would just laugh at me. Your friend is in the same position.

alwaysonthego_2

I am sure that if they change any of the terms of the contract they have to consult staff in writing, he is best contacting ACAS.

tcr_3

Right, if I read it the way you guys do, it's two entirely different matters.

May (or may not) be breach of contract ... needs to get a union rep or full time official involved. But as far as JSA are concerned, every chance they'll apply a sanction if he resigns (and they'll do that even if it's a breach of contract).

One query I've got is this, it's what my mate's asked about, because this is how his TU rep has explained it (in a brief chat late this afternoon) ... if a company feels it has to substantially change someone's terms & conditions, they should put that to the employee, if he agrees to that then his old contract comes to an end and the new contract begins, the contracts run together with no break.

But if he doesn't agree, he gets made redundant and he should qualify for JSA ? He wouldn't be "leaving voluntarily", it'd be a redundancy ?

That's the bit I'm confused on. Am not saying he's right, but there's a certain logic in what he's been told.

Hey, thanks for your advice !

dookar

tcr wrote: »

But if he doesn't agree, he gets made redundant and he should qualify for JSA ? He wouldn't be "leaving voluntarily", it'd be a redundancy ?

I would be very wary of this advice. Impossible to say without more info, but I'm leaning towards it being nonsense.

(being anal I must point out that I refer to the possibility of a sanction, not whether he would 'qualify')

[Deleted User]

could the 20 employees not get the owners to agree to a 12 month pay freeze etc instead of 2 years?

Robbie64

He'd be better off staying where he is and letting his trade union sorting out the employment contract side of things.

Even if he got JSA he is still going to be worse off with no guarantee he'll walk into another job or find anything that pays what he is getting now.

Why doesn't he look for another job while he is employed? He may stand a better chance of getting something better while he is in work.

Personally I think he would be sanctioned and wouldn't get any JSA for 6 months. If he was to claim he was effective being made redundancy he needs to be certain he is right. Any prospective employer may be put off by his reasons for leaving his last job otherwise.