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Ask Employment Law |
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Remember: There is no substitute for legal advice on the actual situation
you find yourself in. The information posted on this site is for general
information only, is based on |
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Question: |
Are employers obliged
to give pay rises? |
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Answer: |
Ordinarily,
there is no obligation on employers as such to give an annual pay-rise. Indeed
in most employment contracts the employer will state that any pay rise will
be in the employers absolute discretion. However
it may occasionally be possible for an employee to argue that the employer
has a contractual obligation to award employee’s an annual pay-rise, for example if: ·
The employment contract says so. ·
There is an obligation to do so under a collective agreement ·
Or possibly by ‘custom and practice’, in other words a minimum
pay rise has been made annually for the last few years, and should therefore
be paid this year. Sometimes employers will promise a pay-rise but not put it
in place. For example in 2005 in the Court of Appeal in Judge –v- Crown
Leisure, at the Christmas party Mr. Judge’s boss promised to bring the
salaries of all employees at his level into line, but did not specify when
this would take place. Later on though, and possibly in a more sober frame of
mind, his boss did not carry through on the promise and Mr. Judge sued.
However the Court of Appeal held that Mr. Judge could not rely on the
promise. In order for there to be a legally binding and enforceable
contractual commitment, there had to be certainty
as to the contractual commitment entered into, or facts from which certainty
could be established. A promise in itself amounts to nothing more than a
statement of intention if it lacks the ‘when’ and ‘how much’ element. In Mr.
Judge’s case, the promise was too vague and uncertain to amount to a binding
contractual promise. As Sam Goldwyn once commented, an oral agreement is not
worth the paper its written on. If an employee is made a promise by an
employer, s/he should confirm his understanding of the agreement as soon as
possible in writing to the employer, which will give the employer less scope
subsequently to argue that there was no such promise. See our page on raising
a grievance Last reviewed: July
2010 |
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Employment
Solicitor Reculver Solicitors Tel
0207 324 6271 Regulated
by the Solicitors Regulation Authority ©
Reculver Solicitors. 2005- |
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