MANUFACTURING | What to do when relocating

One of our Employment Law Advisers received this query:

We have outgrown our factory and have been looking for a new site for some time.

We have found a fantastic site in the next town, but when we announced the change, workers were concerned.

Many are worried as their commute will be longer and more expensive; it may be harder to reach by public transport and that it will negatively affect their work-life balance. Although we understand their concerns, we believe this is the best option for our manufacturing business.

What can we do? Can we force people to move? Can they say no? Do we need to pay them compensation?

Let us consider the issues:

Mobility clauses

The first point of call is to look at employees’ contracts of employment. In the contract, you may have a mobility clause. In other words, there may be a clause which allows the employer to move the employee to another place.

If there is an express mobility clause, the employee will be required to move to the new premises or workplace, subject to the employer exercising their discretion under that clause reasonably. What is considered ‘reasonable’ is not defined in any legislation, but for example, it would not be ‘reasonable’ to move an employee from Brighton to Manchester and only give them 24 hours’ notice. In this case, if it is to the next town and you have given plenty of notice, it may be deemed a reasonable change.

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No mobility clause

If the employee’s contract does not contain a mobility clause, the employee is under no obligation to move. If they do not wish to move, it will be up to you to consult and discuss different options. 

You should explain the reasons for the move and consider if there are any ways to relieve the burden, for example, are there any possibilities that they can work from home or can they work from another site?

You could consider a trial relocation period. This would give them the opportunity to go to the new location for a few weeks and see how they feel about a permanent move.

Unless you agree to do so, there is no duty to pay compensation for relocating. However, these types of incentives could be critical when it comes to convincing staff to relocate.

Refusal

If the employee does not wish to move, this may give rise to a redundancy situation as their job at their current workplace no longer exists.  In these circumstances, the employee cannot unreasonably refuse any suitable alternative employment options. What is reasonable will depend on the circumstances. For instance, if the new site is close and easy to get to and does not significantly disrupt the employee’s family situation, it may be unreasonable for the employee to refuse. Speaking to an Employment Law Solicitor will make sure you are on the right track. Eligible employees may lose their redundancy pay if they unreasonably refuse.

3 top tips:

  • In cases when you are dealing with a high number of employees, you could think about collectively consulting with employees to find out what the main concerns are and find strategies to address them.
  • Make sure you make the employees feel listened to – this will help get them on board with your plans.
  • When considering providing a financial incentive to convince to agree, weigh up the costs of losing valuable members of staff with key skills and experience and the cost of hiring new members of staff to replace them.