Agreed contractual changes

Case 3: The facts

Mr Power's employment contract specified that his contractual retirement age was 60. The part of the business in which he worked was transferred to a new employer, and he agreed to change his contractual retirement age to 65. When the new employer subsequently forced him to retire him at 60, he brought an unfair dismissal claim.

The employer argued that the change in Power's retirement age to 65 was unenforceable, as it was a change to his terms and conditions resulting from a business transfer.

The ruling

The Employment Appeal Tribunal (EAT) held that Power's contractual retirement age had been varied to 65, so his employer could not force him to retire at 60 and he had been unfairly dismissed. While there is case law stating that all changes to contracts resulting from business transfers are unlawful under TUPE, the EAT said this does not prevent changes that are agreed by employees and are to their benefit. An employer cannot, it said, escape its contractual obligations.

Power v Regent Security Services Ltd EAT/0499/06