In The Equality and Human Rights Commission v Earle, Earle (E) accepted a job which provided for a salary range, within which there were a number of incremental steps from the lowest level (where she started) to the top.  She was assured by a HR officer, Ms McDonald (M), that she would be granted progression through the incremental steps if her performance was satisfactory. However, Clause 5.3 of the contract of employment, which sets out the terms for progression expressly stated that there was no obligation on the employer to grant progression and that progression “included” performance, but certainly not that it was ‘solely dependent’ on performance, as indicated by M. The contract also contained a whole agreement clause, Clause 22, part of which read: “This contract supersedes any previous oral or written agreement between the EHRC and you in relation to the matters dealt within it.”

The EHRC was subject to severe financial constraints arising from a tightening of Government funding, and did not award E (or anyone in her position) either progression or a progression review.  An Employment Judge upheld E’s unlawful deduction from wages claim. The EJ found it “obvious” that the contract provided E with an express mechanism and right for her to receive a ‘starting salary’ and then a salary increment, triggered by the annual Performance Review subject only to one condition, namely a condition of satisfactory performance.

The EAT upheld the EHRC’s appeal, holding that it was clear that the wording of Clause 5.3 does not, on the face of it, convey a right to incremental progression subject only to satisfactory performance.  The words simply do not appear. Therefore, the EJ’s decision contradicted the clear meaning of the contract. As to the words used by M, which the EJ thought constituted the part-formation of a contract, the EJ did not deal with the impact of Clause 22 of the written contract which denuded the prior contract (if it was such) or collateral warranty (if it was that) of any effect, i.e. it superseded any assurances given by M. 

The practical lessons are threefold: (i) recruiters and those involved in the job offer process should be very careful about what they say when giving verbal assurances to successful job applicants about the terms and conditions of employment; (ii) contractual terms must be drafted in a clear and unambiguous way; and (iii) contracts should contain an overarching clause stating that its terms supersede any previous oral or written agreements.

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