Document employee promotions correctly or you may expose a “sting in the tail”

For some business owners the end of the year is a time for the annual performance review of staff, and in some cases the promotion of staff.

These days most employees sign some form of written agreement before they commence work. Usually, that agreement will contain the key terms of the employee’s employment, including your right to terminate the employee’s employment on the provision of an agreed amount of notice. This email is targeted specifically to protect that right.

In some instances, a promotion with new duties will have the effect of creating a new contract of employment. Accordingly, you should, at the very least, confirm the promotion in writing, the additional duties, the increase in salary, and that “in all other respects the terms and conditions of your employment remain unchanged”.

By doing this, and provided the earlier agreement contained your right to terminate the employment on the provision of an agreed amount of notice, you will have preserved that right. If you fail to preserve that right, the amount of notice you may be required to give could be “reasonable notice”. “Reasonable notice” could range from one week to two years depending on the employee’s circumstances. If the employee has been working with the business for 20 years, working his or her way up from the “shop floor” to senior management, then “reasonable notice” could be very significant.

Remember, just add these few words…

“in all other respects the terms and conditions of your employment remain unchanged.”