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Promised a certain salary, then find it has been pro rata’d
I’ve been working for a company on a freelance basis for a few months. They decided they wanted to make me a permanent member of staff and add me to the payroll. We negotiated on hours to fit around childcare and agreed on 26 hours per week. We then moved on to salary and they made an offer. They were keen to point out it was very generous for the hours and joked it was more than £1,000 for every hour worked a week. Fast forward a month and I receive my first payslip and they’ve pro rata’d my salary! This was never mentioned at any point in the discussions and I now have a meeting to discuss. Where do I stand? No offer was put in writing it was just verbal.
Contractual terms can be in writing or verbal. However, there is a statutory requirement on an employer to provide an employee with an s1 statement of terms and conditions on or before the commencement of employment, setting out the main terms of employment, including hours of work and salary. Had your employer done so this uncertainty as to the terms upon which you were employed and the risk of a dispute arising could have been avoided. They are therefore in breach of their statutory requirements. If subsequent agreement cannot now be reached on the terms then it is open to you to apply to the Employment Tribunal for them to decide the terms which ought to have been included in the statement.
It would appear that the disparity in what you thought had been agreed and what your employer believes was agreed has been discovered promptly immediately upon the first salary payment date and that you have already raised the issue as an informal grievance in an attempt to resolve the issue, which may simply be a misunderstanding that your employer is prepared to rectify. You do not say how much you were paid as a freelance worker and consequently it is difficult to assess whether the hourly rate you were offered as an employee is in line with that or whether it is so out of kilter to that rate so as to enable a determination on whose part any misunderstanding may have rested.
If you do not reach agreement as to the salary, then you should submit a formal grievance and, ultimately, if that is not determined in your favour then will need to consider whether you remain with the company on the revised salary offered, or whether you leave the company and seek to recover the shortfall in the wages you believe you were contractually entitled to in that first month by way of an unlawful deduction from wages claim or a breach of contract claim, which will not be without difficulty. In order to succeed in such a claim you will need to establish to an employer that the wages were properly payable to you. This will involve the tribunal determining based on the evidence what was agreed at the outset in terms of payment.
If you do not reach satisfactory resolution with your employer following your grievance, you should take legal advice.
*Helen Frankland has assisted with this reply.
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Comments [1]
Cath Harrison says:
I’ve found myself in a very similar scenario. I agreed a full time salary rate but to work a 4 day week. I took a drop in salary but agreed still being paid the full salary for a part time work pattern was a good package. I’ve received my first and final salary and they have no pro rated the pay. My contract is really clear it says working a 4 day week but being paid a full time salary agreed. They are now refusing to honour the contract and pay me £1000 less than agreed which means AI would have never agreed to take on the job. I don’t know where I stand.