Continuing to work following a pay freeze did not signal acceptance

In Abrahall and ors v Nottingham City Council and anor [2018], the Court of Appeal held that a group of employees who continued to work following their employer’s imposition of a pay freeze did not agree to a variation of contract. The pay freeze was implemented in March 2011 and whilst the union communicated its opposition, no industrial action was taken and no employee raised a grievance.   When the Council decided to impose a similar freeze in April 2013, several hundred employees brought claims for unlawful deductions on the basis that they had a contractual entitlement to incremental pay increases.

Although the employees did not bring tribunal claims until two years later, this could not be taken as unequivocal acceptance of a change that was wholly to their disadvantage.  The court made 3 observations relevant to the question of acceptance (1) if the employee’s conduct in continuing to work is capable of a different explanation, it cannot be treated as acceptance (2) protest at the collective level may be enough to negative any inference of acceptance (3) the difficulty in inferring acceptance after ‘a period of time’ is when this point has been reached.

It is worth mentioning that, along with the time that had elapsed, at no point did the employees or union state in terms that they did not accept the change when it was implemented.  This case is a cautionary lesson in relation to imposing contractual changes.  Obtaining the express agreement of employees is by far the safest option and it will usually be necessary to consult on any proposed changes in advance.  If you are considering making changes to employees’ terms and conditions, please contact a member of our employment team for guidance on this process.