Employment Law Cases

Flexibility clause and extra pay

An employee who was contractually required to work variable shift lengths was not entitled to additional pay for working beyond his average weekly hours.

Background

Mr Hudek worked as a driver for Brake Bros. His contract stated that he worked five shifts per week for a fixed salary. Each shift was intended to be 9 hours long (later increased to 9.4), but his contract stated that he would be required to work ‘such hours as were necessary for the proper performance of his duties’. Overtime was only payable if he worked an additional full or half shift, with a half shift defined as at least 4.5 hours. If he worked beyond the standard shift length but less than 4.5 hours, no additional pay was provided. Between 2021 and 2022 Mr Hudek’s shifts averaged just over 10 hours.

He brought an unlawful deduction from wages claim He argued that he had worked more than his contracted weekly hours and that he should have received pro-rata payments (based on annual salary) for the additional time worked, even if it was less than half a shift.

A tribunal held that Mr Hudek’s contract of employment provided for an ‘averaging out’ of his working hours and that was an implied term that, if no such averaging out took place within a reasonable period, he would be paid for all additional hours worked above the intended average. Brake Bros appealed.

EAT decision

The appeal was allowed.

The starting point was Mr Hudek’s contract of employment and its express terms. These set out a clear structure. Drivers were paid a salary for five variable length shifts per week, with specific overtime payments only triggered for full or half shifts.

While his normal working hours were 47 hours per week over five shifts, this was subject to a requirement to work such hours as were necessary for the proper performance of his duties on each shift. The tribunal correctly concluded that the contract provided a mechanism for flexibility, but incorrectly elevated that flexibility into an enforceable contractual obligation which gave rise to an entitlement to additional pay.

In any event, neither business efficacy nor the unexpressed intention of the parties justified the implication of a term that he would be paid for hours worked in excess of his intended normal working hours other than when the employment contract’s express overtime provisions applicable to drivers were engaged.

Comment

Contractual clauses requiring employees to work ‘such hours as necessary’ can lawfully provide flexibility without giving an entitlement to extra pay—provided that such clauses are clear and unambiguous.

The decision is also a useful reminder that whilst it’s possible for tribunals to imply a term into a contract, such an intervention is only permissible where it is necessary to give business efficacy to the contract (i.e. make it work) or to enforce the obvious but unexpressed intentions of the parties.