Amending an employment contract
An employment contract binds both the employer and the employee, and in general neither can unilaterally change the contract without legal grounds. However, both parties can agree at any time to change the terms of employment.
As an employer, your supervisory right entitles you to manage work in the workplace, and your employees are obliged under the Employment Contracts Act to follow instructions given by their employer within the bounds of its supervisory right. When you exercise this right as an employer, you are not changing the terms of employment. Your supervisory right generally entitles you to assign the scope of the work, that is, what to do, and where, how and when to do it. However, your supervisory right does not generally allow you to change essential terms of employment or specific terms contained in the contract. Further, you cannot exercise your supervisory right to amend terms laid out in legislation or mandated by collective bargaining agreements.
If both parties agree, the terms of the contract and of employment can be amended. In addition, the terms of employment can change due to amendments to legislation or collective bargaining agreements. Such changes include sectoral pay rises under collective-bargaining agreements.
If you change an employment contract substantially, we recommend making the changes in writing, or, as an employer, giving your employees a separate written explanation of the changes to the employment terms as soon as possible, but no later than the end of the next salary period. It is worth remembering that employment legislation contains several provisions on which contracts and employment terms cannot deviate from to the employee’s disadvantage. If they do, the contract or specific terms of employment are null and void.