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Contractual status of benefits

“In the past, we have typically paid employees a bonus of £1,000 in January as a “thank you” for their efforts the previous year.  Pay reviews are carried out at the same time.  2015 was a difficult year for our business and we need to make some cut backs.  Can we avoid paying an annual bonus and awarding a pay increase this year?”

Before going so far as to revoke any existing benefits, an employer should first look at its employment contracts and any other contractual documentation to ensure that there is no clear contractual entitlement to the same.  Obviously, if there is, then a failure to honour such terms will amount to a breach of contract.

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