Thousands of Lancashire employers exposed to breach of contract claims

By Hesford Media

13 Nov 2020

compromise.jpg

Thousands of employers in Lancashire are likely to have expensive legal claims made against them in 2020 and 2021 as it comes to light that a huge number are in breach of their contract with their employees after engaging with the Coronavirus Job Retention Scheme.  

While those companies who have an in-house HR or legal representative at hand may be protected, the greatest risk is to micro businesses who are likely to have DIY-ed their legal and HR processes at the start of the pandemic.

It was assumed by many, that the CJRS simply replaced the employment contract they had with their employees, but this is simply not the case. Where an employment contract was in situ a fixed number of hours, for a fixed level of pay – employers will find themselves in breach of contract where they have paid 80% of their employees salary without mutual agreement to amend the employment contract.

As many employers will have simply told their workforce to ‘stay at home’ and receive 80% pay for doing so, they have neglected to understand that the original employment contract is still legally binding if no formal changes are made and agreed, and this exposes them to claims being made against them for the remaining 20% of their pay.

Victoria Hodkinson, from the Commercial Department at TEN Legal Solicitors says, “We are already seeing employees who have been made redundant, who are not entitled to much or any redundancy pay due to a short service with their employer and the prospects of finding a new job looking bleak, that are making legal enquiries as to whether their employer still owes them anything.

We are also receiving a high number of enquiries from smaller organisations, sometimes with just one or two employees, who realise that they have unknowingly exposed themselves to expensive claims for breach of contract. A lot of our recent work has been around Compromise Agreements, which pay the employee a severance payment in order to waive their entitlement to a future claim, in order to mitigate that future risk”

It is not unlikely that some law firms will start to advertise, in the same way they do for personal injury and mis sold PPI, asking employees whether they agreed to change their employment contract when they were furloughed and offering them compensation if they did not – making this type of claim a very lucrative industry over the coming months and years.

Latest news

1

Lancashire firms on fastest growing list Adam Morning and Dan Wilkins from CAPO and Will Fletcher from Car.co.uk

Lancashire firms on fastest growing list

05 Jun 2026

2

Velocity appointment looks over the pond Declan Grant

Velocity appointment looks over the pond

05 Jun 2026

3

Nordic move for health-tech specialist Hepro CEO Gier Tore Jakobsen And Chiptech CEO David Hammond

Nordic move for health-tech specialist

04 Jun 2026

4

Family firm to open major distribution centre Melba Swintex Distribution Hub

Family firm to open major distribution centre

04 Jun 2026

5

Fuuse appoints new chief executive for next chapter of growth Michael Gibson and Roger Hunter

Fuuse appoints new chief executive for next chapter of growth

04 Jun 2026

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
Funding Summit
Funding Logo Canva Mid
Summit
17 Jun 2026

Funding Summit

Village Hotel Blackpool

08:30 - 11:00

LBV129 July/August Magazine Networking Event
Nov/Dec Networking Event
Networking
16 Jul 2026

LBV129 July/August Magazine Networking Event

Brysdales, Britannia Buildings Drumhead Road, Chorley, PR6 7BX

16:00 - 18:00

LBV130 September/October Magazine Networking Event
Jan/Feb Networking Event - Entrance
Networking
17 Sep 2026

LBV130 September/October Magazine Networking Event

The Beehive Blackburn, Shadsworth Business Park, BB1 2Q

08:30 - 10:30

LBV131 November/December Magazine Networking Event
Jan/ Feb Networking Event - Talking
Networking
19 Nov 2026

LBV131 November/December Magazine Networking Event

Lancashire

08:30 - 10:30

Yellow Day 2026
LBV Hub Fundraisers
07 Jun 2026

Yellow Day 2026

St Catherine's Hospice, Preston, pr55xu

11:00 - 16:00

Hampton by Hilton Blackburn Corporate Social Evening
Hampton Corporate Social (2).jpg.jpg
LBV Hub Networking
09 Jun 2026

Hampton by Hilton Blackburn Corporate Social Evening

Hampton by Hilton Blackburn, Blackburn, BB1 3AL

18:00 - 20:00

Opening doors and opportunity for Tech in Preston
PTC Square June (900 x 900 px)-2.png.png
LBV Hub Networking
09 Jun 2026

Opening doors and opportunity for Tech in Preston

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Clubhouse Business Network sponsored by Orca Finance - June 2026
Padel Network.png.png
LBV Hub Networking
11 Jun 2026

Clubhouse Business Network sponsored by Orca Finance - June 2026

Clubhouse , Blackburn, BB1 3NT

14:00 - 16:00

The Business Network Central and East Lancashire
LBV Header (33).png.png
LBV Hub Networking
18 Jun 2026

The Business Network Central and East Lancashire

Stanley House, Blackburn, BB2 7NP

11:30 - 14:15

Chamber Business Lunch
LBV Hub Networking
19 Jun 2026

Chamber Business Lunch

Lancaster House Hotel, Lancaster, LA1 4GL

11:00 - 14:00

The Bay Business Club
Logo.jpg.jpg
LBV Hub Networking
22 Jun 2026

The Bay Business Club

Morecambe Football Club, Morecambe, LA4 4TB

17:00 - 19:00

Cyber Crime Awareness Event
Logo.jpg.jpg
LBV Hub Seminars
24 Jun 2026

Cyber Crime Awareness Event

Morecambe Golf Club, Morecambe, LA4 6AJ

13:00 - 16:00

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV124 Online Graphic
Subscribe now

Weekly news bulletin