Providing the term is implemented properly, a broad contractual right to alter the terms and conditions of employment in line with business needs can enable an employer to make unilateral changes without employee consent, even if the altered terms are contained within a company handbook.

In this claim, Asda sought to bring its entire staff under one pay and work structure. The company handbook contained the terms which required alteration and a statement that Asda reserved the right to alter and amend in line with business needs. Asda claimed that it was therefore able to rely on this statement to amend the company handbook without obtaining employee consent. The EAT agreed; confirming the crucial point that as Asda had incorporated the handbook into employees' employment contracts, it could be relied upon. In this instance, Asda did actually consult extensively with its staff and attempted to ensure that no staff member suffered a wage reduction.

A word of caution to employers is that variation clauses can't simply be added into contracts or varied for that matter without going through a proper process. In addition, the employees in this case did not plead at tribunal that there had been a breach of trust and confidence, had they done so the outcome may have been different.

Bateman v Asda Stores Limited