Changing SMTs

Where there is a change in any of the particulars referred to in the statement of main terms of employment (SMT) after it has been given to the employee, legislation requires the employer to give a written statement containing details of the change or refer the employee to some other accessible document containing details of the change, such as an employee's handbook. Normally this must be done no later than one month after the change in question. As the employment relationship rarely stands still for long, such changes actually happen more often than you may think.

Usually this does not cause any problem, as the employer will often have complied with this provision without realising it. For example, pay increases will normally be reflected on pay slips and agreed changes to the hours or place of work resulting from the right to request flexible working will be notified in writing.

This is not always the case, as sometimes changes are only agreed verbally. Instances of this include employees moving within a company to a different role with a different job title, though nothing is put in writing to the employee. There are also two further circumstances where an employer is likely to fall foul of this requirement.

- Where the name of the employer is changed without there being any change in their identity.

- When the identity of the employer changes in circumstances where the employee's continuity of employment is not broken, such as a transfer of business or other undertaking.

In the latter case, the statement of change to be issued must specify the date on which the employee's period of continuous employment began, as well as the name of the new employer. In both cases, if there is also a change to any of the other matters included or referred to in the SMT, then a whole new SMT must be issued.

Until recently, the only consequence of a failure to issue a written statement of change was that the employee could refer the matter to tribunal, which could then deem the statement to include the relevant particulars. However, since 1 October 2004, where a tribunal finds in favour of an employee in relation to almost any claim made, other than a claim for failure to issue an SMT or statement of change, the tribunal must make an award of two weeks' pay. Subject to the statutory limit, the tribunal may make an award of up to four weeks' pay if there has been a breach of these requirements unless exceptional circumstances apply.

Four weeks multiplied by £310, the current maximum, equals £1 240 per employee. This may not seem much but it can soon add up.

- Peter Done, Managing director, Peninsula Business Services.