Mr. Powell was an ATM engineer in London. After the Claimant became disabled through a back injury the Respondent gave him work in a new role (“key runner”) at his existing rate of pay and led him to believe that the role was long-term.  The following year, however, it said that it was only prepared to employ him in this role at a reduced rate of pay by around 10% because he had fewer responsibilities as a key runner; and when the Claimant refused to accept these terms he was dismissed.

It was argued by the Claimant that there was a variation of his contract entitling him to work as a key runner at his existing rate of pay.  The Employment Tribunal found that there was no such variation.  The Claimant cross-appealed on this point.  The Employment Tribunal had rejected his case, at least in part, because it considered that an employer was entitled to impose an adjustment on an employee without the employee’s consent.  This was an error of law, according to the EAT:

"If an employer proposes an adjustment which is incompatible with the terms of the contract of employment, the employee is entitled to decline it: the adjustment will not be effective without agreement, that is to say without a variation of the contract.  No doubt in the vast majority of cases such agreement will be forthcoming but there will be cases where an employee does not agree with a proposed adjustment.  In such a case an employer is not entitled to impose it if the adjustment is incompatible with the terms of the contract of employment.",

However, the Employment Tribunal went on to find that the Respondent was required, as a reasonable adjustment, to employ the Claimant as a “key runner” at his existing rate of pay.  Sitting alone, Richardson J stated, "...the objectives of the legislation plainly envisage an element of cost to the employer; if an adjustment is one which it is reasonable for the employer to have to make, it is not a matter for charity, but a legal requirement reflecting the expectations of Parliament and society.  The objective is to keep employees in work, and I see no reason why a package of measures for this purpose, which includes some pay protection, should not be a reasonable adjustment."

The Employment Tribunal had been entitled to reach its conclusion in this case that payment protection was a reasonable adjustment, said the EAT. It may not be a regular occurrence but the EAT could see that protecting salary for a longer term could be part of a reasonable adjustment package:

"I do not expect that it will be an everyday event for an Employment Tribunal to conclude that an employer is required to make up an employee’s pay long-term to any significant extent - but I can envisage cases where this may be a reasonable adjustment for an employer to have to make as part of a package of reasonable adjustments to get an employee back to work or keep an employee in work.  They will be single claims turning on their own facts... The financial considerations will always have to be weighed in the balance by the Employment Tribunal... I make it clear, also, that in changed circumstances what was a reasonable adjustment may at some time in the future cease to be an adjustment which it is reasonable for the employer to have to make; the need for a job may disappear or the economic circumstances of a business may alter...

"I do not, however, accept that the Employment Tribunal erred in law or was perverse in the conclusion it reached.  The effect of its decision was to say that the Respondent should have continued an arrangement which had already been in place for nearly a year and which it had led the Claimant to expect to be long-term.  The Employment Tribunal took into account and analysed such financial evidence as it had bearing on the question whether it was reasonable for the Respondent to have to take a step in question.  The main reason for not paying the Claimant the SLM rate was said to be the likelihood of discontent from other employees: this is an unattractive reason, and the Employment Tribunal was entitled to reject it..."

http://www.bailii.org/uk/cases/UKEAT/2016/0243_15_2608.html