Clause in contract

Atkins · 18 January 2020 at 9:58AM

Hi everyone!

Longtime lurker but first time poster here.

So I was bored at dinner time the other day and started reading my contract. In it there is a clause saying that the company may, at their discretion, cancel my contract immediately for any reason and without paying me anything. Surely this is illegal under current UK labour laws?

I'm sure they are not going to fire me, but I've honestly never seen this clause before.

Browntoa · 18 January 2020 at 10:03AM

If you have been employed for under 2 years then yes it's legit.

Neil_Jones · 18 January 2020 at 10:05AM

This may be more to do with immediate dismissal such as for gross misconduct.

Atkins · 18 January 2020 at 11:30AM

There is a separate paragraph for gross misconduct. The one I'm referring to definitely says they can fire me at any time for any reason with no severance pay.

I would like to think they would not get away with since it is against UK law, but it is written in black and white in my contract so I'm not sure.

I've been there 20 years so I'm not exactly a new starter!

Masomnia · 18 January 2020 at 11:43AM

Not legit no. I wouldn't worry about it, they can't rely on it.

Blatchford · 18 January 2020 at 11:51AM

Masomnia wrote: »

Not legit no. I wouldn't worry about it, they can't rely on it.

To be fair, I'd prefer to see the actual clause and context. Much as I'd agree that I can't imagine how it would be lawful, I also wouldn't issue a carte Blanche opinion without anything to base it on. After all - it would have been equally unlawful 20 years ago, as the law hasn't changed that much! So why would the employer have thought they could rely on it then?

nicechap · 18 January 2020 at 11:52AM

Atkins wrote: »

Hi everyone!

Longtime lurker but first time poster here.

So I was bored at dinner time the other day and started reading my contract. In it there is a clause saying that the company may, at their discretion, cancel my contract immediately for any reason and without paying me anything. Surely this is illegal under current UK labour laws?

I'm sure they are not going to fire me, but I've honestly never seen this clause before.

Atkins wrote: »

There is a separate paragraph for gross misconduct. The one I'm referring to definitely says they can fire me at any time for any reason with no severance pay.

I would like to think they would not get away with since it is against UK law, but it is written in black and white in my contract so I'm not sure.

I've been there 20 years so I'm not exactly a new starter!

Employment contracts cannot overide UK laws except where allowed in UK law (e.g. working time hours by mutual agreement).

That said, without seeing the rest of the contract its difficult to absolutely sure the intent of the clause, just because its not in the dismissal section does not mean it does not apply to dismissals - but even then they'd have to pay up to date of dismissal.

If your employer is a multi-national it might just be lazy cut & pasting from US/ Canada contracts. Or it might mean if they choose to give you notice they don't have to explain why, just pay what you're entitled to and nothing extra.

But don't take views from the internet as absolute, speak to your union or take independent legal advice.

Atkins · 18 January 2020 at 1:02PM

Thanks for the replies guys, it's appreciated.

So I've just looked in my terms and conditions handbook at home and there is a line in a section headed termination which reads:

"The Company may, in its sole and absolute discretion, terminate your employment at any time and with immediate effect."

It then goes on to say that I would be payed a sum in lieu of notice. I'm pretty sure but not 100% certain that it does not say that in my latest contract, which unfortunately I left at work so I can't read it now. This is the 6th or 7th revised contract I've had over the years. I always used to make a point of reading through them to find any changes but must admit for the last one or two I didn't bother.

I was under the impression that it was almost impossible to fire somebody unless they committed an act of gross misconduct, or incompetence etc. My contract leads me to believe that my manager or a director could just one day decide he doesn't really like me for some reason and fire me on the spot.

Just to make things clear, I don't believe I am in danger of being fired, I just happened to notice this clause in my contract that I have never seen before.

Blatchford · 18 January 2020 at 1:25PM

Atkins wrote: »

Thanks for the replies guys, it's appreciated.

So I've just looked in my terms and conditions handbook at home and there is a line in a section headed termination which reads:

"The Company may, in its sole and absolute discretion, terminate your employment at any time and with immediate effect."

It then goes on to say that I would be payed a sum in lieu of notice. I'm pretty sure but not 100% certain that it does not say that in my latest contract, which unfortunately I left at work so I can't read it now. This is the 6th or 7th revised contract I've had over the years. I always used to make a point of reading through them to find any changes but must admit for the last one or two I didn't bother.

I was under the impression that it was almost impossible to fire somebody unless they committed an act of gross misconduct, or incompetence etc. My contract leads me to believe that my manager or a director could just one day decide he doesn't really like me for some reason and fire me on the spot.

Just to make things clear, I don't believe I am in danger of being fired, I just happened to notice this clause in my contract that I have never seen before.

And that is why I never believe the first thing people tell me - it does not say what you said it said, and what it says is technically lawful! Any employer can fire you without notice and make a payment in lieu of notice. Whether that amounts to unfair dismissal is an entirely different thing...

Undervalued · 18 January 2020 at 2:01PM

Atkins wrote: »

I was under the impression that it was almost impossible to fire somebody unless they committed an act of gross misconduct, or incompetence etc. My contract leads me to believe that my manager or a director could just one day decide he doesn't really like me for some reason and fire me on the spot.

Ultimately anybody can be fired, with or without good reason! The legal protections, such as they are, may entitle you to some financial compensation if you are able to persuade a tribunal that it was legally unfair dismissal.

Also it could be wrongful dismissal (i.e breach of contract) in which case you could claim whatever amount would have been due had they followed the contract correctly.

However, no tribunal can force an employer to continue to employ you and in the vast majority of cases any compensation is far less than most people fondly imagine.

Atkins · 18 January 2020 at 2:36PM

Blatchford wrote: »

And that is why I never believe the first thing people tell me - it does not say what you said it said, and what it says is technically lawful! Any employer can fire you without notice and make a payment in lieu of notice. Whether that amounts to unfair dismissal is an entirely different thing...

My terms and conditions handbook does not say what I said my contract said, but unfortunately my contract is at work and I am not so I am unable to read it. The handbook is dated 2015 and my latest contact was issued about 6 months ago. I'm pretty sure but like I said not 100% certain it said they would not pay me anything in the event of my dismissal. It seems they would have to pay me something, but could fire me at any time.

Guess I'll have to be nice to my manager! I've just had a quick google and it seems you can possibly be re-instated or re-engaged after being fired if a tribunal finds your dismissal was unlawful but this is extremely rare, and who would want to work for an employer who didn't want you there?

Clause in contract

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