Letter informing employee that the business is relocating

Use our letter informing employee that the business is relocating once you have started to firm up your plans to move. How you deal with the situation from here will depend on whether you’re relying on an express mobility clause to implement the relocation or whether you are seeking employees’ express consent to the move, failing which you’ll need to embark on a redundancy programme.

Relevant procedure

Once your relocation plans are a little more definitive, you can use our Letter Informing Employee that the Business is Relocating. There are two main options here. The first assumes there is an appropriately worded mobility clause in the employee’s contract and that therefore the business relocation will take place by implementing that clause, rather than by commencing a redundancy programme. Ensure you check the precise wording of your clause here to make sure it covers the permanent move to the new premises and be aware you are still bound by the implied term of mutual trust and confidence - hence the letter still proposes a meeting with the employee to consult with them and take account of their views. The second option is for use where there is no mobility clause, so that the employee’s express consent is needed to the move, failing which you would then have to embark on a redundancy programme in the usual way. In this scenario, bear in mind that, at least in theory, all of your staff could refuse to move and hence need to be made redundant. Even if you know this is highly unlikely to happen in practice, if you employ 20 or more affected employees, then you will also be under collective consultation obligations, entailing consultation with either trade union or workplace representatives. This is additional to individual redundancy consultation obligations. Employees who indicate their willingness to relocate should be asked to confirm their consent in writing. Thereafter, you can issue them with new contracts of employment containing details of the new place of work within one month of the change.

Mobility clauses

Where there is a suitably drafted mobility clause in the employee’s contract of employment entitling you to instruct them to relocate, you can invoke this without the need for a redundancy procedure to be followed. The use of the mobility clause in effect avoids the need for redundancy. However, you’ll need to make it clear to the employee from the outset that you are invoking the mobility clause and not following a redundancy programme in relation to the relocation. If you start to follow a redundancy programme, you will need to continue it and can’t then switch to relying on the mobility clause. If you do invoke a mobility clause but the employee refuses to move, you may be able to dismiss the employee for misconduct, i.e. refusal to obey a lawful management instruction to move, and not redundancy. No redundancy payment would then be due. However, for the misconduct dismissal to be fair, you will need to have given reasonable notice of the relocation arrangements, you must have good business grounds for making a significant relocation decision and you should have looked at effective ways of mitigating the impact of relocation on staff. Always exercise caution when relying on a mobility clause to move employees some distance and consider their individual personal circumstances.