The amending notice and the annex - when does it apply?
The reorganization of an enterprise may also involve the need to change the working conditions of its employees. If it means the employee receives a benefit, it should not be a problem to do so. However, difficulties may arise when the employer is forced to change the provisions of the employment contract to the detriment of the employee. Then it has two options - one of them is an annex to the contract, which is concluded with mutual consent, while the other is the so-called amending notice, i.e. unilateral declaration of the employer regarding new working conditions.
The employer cannot independently and freely change the terms of employment of employees. They must agree to any such change. In the event of its absence, the existing agreement between the parties (the original contract) shall remain in force. An attempt to introduce modifications to an employment contract often creates conflicts between the employer and the employee, which often ends with the termination of the employment contract or even a case in the labor court. Depending on the situation, the employer can choose between an annex (the so-called amending agreement) or an amending termination notice. It is obvious that concluding an amending agreement is definitely a more advantageous solution for the employer than terminating the contract. However, if the employee does not want to agree to the change of conditions, then the employer may only change them by terminating them. So what exactly characterizes the annex to the contract, and what does the amending termination notice? How can an employer change working conditions by terminating an employment contract? What is more beneficial for the employee and what for the employer? We will answer these questions in this article.
When should an annex to the contract be concluded or an amendment notice issued?
Not every change in the working conditions or salary of an employee will entail an obligation to formally change the provisions of the employment contract. Changes that do not affect the type of work performed or the amount of remuneration do not require modifying the original contract. However, changing the contract will always be necessary in the case of:
- lowering the employee's base salary;
- depriving an employee or changing additional elements of remuneration (e.g. liquidation of a functional allowance);
- changes in working hours - change in the working time, change in the hours of starting and finishing work, introducing a lunch break;
- change of the place of work (especially in the case of transferring the employee to a branch office remote from his place of residence or to another location);
- a significant change in the name of the job position or scope of duties (e.g. as a result of organizational changes in the company's structure).
Termination of employment conditions is possible not only in the case of contracts for an indefinite period, but also fixed-term contracts, if they were concluded for a period exceeding six months and the parties provided for the possibility of early termination.
Annex, i.e. the amending agreement
The annex to the contract is a mutual agreement to change the terms of the employment contract. With its help, the parties can change practically all provisions of the contract (both working conditions and pay), for the benefit or disadvantage of the employee. The annex takes the form of an additional document attached to the contract, under which individual terms of the contract change. What matters is its content, not its name - an amending agreement may have different names, e.g. an annex to a contract, a salary promotion or an agreement to amend an employment contract.
Although the possibility of concluding an amending agreement was included in Art. 29 § 4 of the Labor Code (hereinafter referred to as the Labor Code), the same agreement uses the principle of freedom of contract. This means that the parties are free to modify the record of the original employment contract. The same applies to the acceptance of changes by the employee - the deadline is set by the parties. They should detail the date on which the changes are to take effect. It may be the day of signing the annex or a later day. The parties may conclude an amending agreement even when the employee is subject to special protection - pregnancy, pre-retirement age or sick leave. The provision of art. 29 § 4 of the Labor Code provides for the requirement of a written form, but does not mention the invalidity of the agreement in the event of failure to observe it. It follows that it may also take the oral form, but then, in the event of a court dispute, proving the conclusion of such an agreement will be difficult.
Although the parties are free to modify the provisions of the original employment contract, they must pay attention to Art. 18 § 1 of the Labor Code This provision states that the provisions of employment contracts may not be less favorable to the employee than the provisions of the labor law. This means that the agreement in question may not lead to the deterioration of the employee's situation below the lowest level guaranteed by the provisions of the labor law. The provisions of the labor law also include company regulations, e.g. those concerning remuneration. The issue of remuneration can be taken as an example - the employer has no right to "propose" the employee to change the contract to one in which the remuneration will be lower than the currently applicable minimum wage.
An amending notice is a notice of working and pay conditions with a simultaneous proposal to conclude new terms. It was regulated in Art. 42 of the Labor Code What distinguishes them from the classic termination of an employment contract is the fact that the former is not intended to terminate the employment relationship, but only to transform it. The content of the amending notice must obligatorily contain a proposal of new working conditions. It is unacceptable for the employer to terminate the employment contract with the employee and at the same time undertake to present new working conditions to him in the future. The determination of these modified terms is an essential element for the amending termination.
It is also important that the amending termination may be effective only with the consent of the employee. In the event of a refusal to accept the new conditions, the employment contract terminates with the end of the notice period, and such termination shall entail all the consequences of the termination made by the employer.
Due to the fact that the discussed type of dismissal may result in dismissal, due to the protection of the employee specified in the KP, all the requirements related to the termination by the employer apply to the employee. In order for a binding amending termination to take place, in the case of employees employed under a contract for an indefinite period, the employer is obliged to justify its decision and consult with the company trade union organization. On the other hand, if such a notice is to be addressed to an employee employed under a fixed-term contract, it will only be possible in certain situations, i.e .:
- when the parties have concluded a fixed-term employment contract longer than six months and it contains a clause on the possibility of early termination;
- announcement of liquidation or bankruptcy of the enterprise;
- application of the act on collective redundancies in a group and individual procedure;
- the parties concluded an employment contract for the duration of the replacement.
The employer cannot take advantage of the institution in question with regard to employees subject to special protection, i.e. pregnant employees, employees with pre-retirement age or on sick leave. The employer must remember that the submission of new terms and conditions must be in writing. The employee, on the other hand, has the right to accept or reject the proposed new conditions until the end of the half of his / her period of notice. However, in this case, the employee's declaration may be made in any form - written or oral. However, in the event that the employee does not respond to the content of the amending notice, the Labor Code provides for a legal presumption expressing consent to the new terms. When applying mass dismissal terminations, an employer employing at least 20 people should remember about the obligation to apply the group layoffs procedure, regulated in the Act on special rules for terminating employment relationships with employees for reasons not related to employees. Should there be a situation in which employees refuse to accept the new conditions, the employment relationship is terminated and the collective redundancy ceiling is reached.
When does the change of working conditions not require an addendum or termination?
It will not be necessary to apply an addendum or an amendment notice in every situation. If, in accordance with the legitimate needs of the enterprise, the employer entrusts the employee with a different type of work than that specified in his contract during a period not exceeding three months in a calendar year, there is no need to conclude a formal agreement to amend the terms of the contract. However, it should be remembered that such a change cannot affect the employee's remuneration (it cannot be reduced), and the work should correspond to his qualifications.
According to the jurisprudence, the qualifications of an employee should be understood not only as professional preparation, i.e. education, work experience or practical skills, but also their psychophysical properties, mental predispositions and the ability to perform specific activities from the point of view of physical health.
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Annex and changing term - comparison
Comparing the institution of the amending agreement with the amending notice (discussed above), it should be stated that the former is more favorable for both the employee and the employer. The employee has a real influence on the content of the agreement, can negotiate the terms and refuse to sign the annex, which will result in the original provisions of the employment contract remaining in force. The employer, on the other hand, is not obliged to pay the employee a severance pay or compensatory supplement intended for particularly protected employees. Additionally, in the case of mass amending agreements, the procedure provided for in the act on collective redundancies does not apply.
The amending notice, on the other hand, is a unilateral declaration of will by the employer, so that the employee cannot influence the content of the contract modification - he or she can either agree to sign a new one or leave the job. For the employer, termination is also not the best solution, if we assess it from the financial point of view. Each termination, including the amending one, in certain cases specified in the Act is associated with the obligation to pay a severance pay, compensation for unused leave, etc. Moreover, the employer may not terminate the contract if the employee remains under protection, e.g. during pregnancy or sick leave.