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

REVEALED: Sub36 Awards winners 2026 S36 Winners

REVEALED: Sub36 Awards winners 2026

16 Oct 2026

2

Three in a row for Lancaster accountants at national awards The Team At Ics Celebrating Their Win

Three in a row for Lancaster accountants at national awards

15 Oct 2026

3

Victorian Plumbing records 11 per cent revenue increase Victorian Plumbing staff

Victorian Plumbing records 11 per cent revenue increase

15 Oct 2026

4

Preparation matters for MTD changes Bilal Piperdy

Preparation matters for MTD changes

15 Oct 2026

5

Training for scheme to boost number of women in technology Aerial photo of Lancaster University Campus

Training for scheme to boost number of women in technology

15 Oct 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
LBV131 November/December Magazine Networking Event
LBV131 Magazine Launch Social720No Text 19 Nov 2026

LBV131 November/December Magazine Networking Event

The Landmark, School Lane, Burnley, BB11 1UF

08:30 - 10:30

Lancashire Business Day 2026
LBD26 WW Logo720 27 Nov 2026

Lancashire Business Day 2026

Burnley Football Club, BB10 4BX

12:00 - 17:00

Help to Grow: Management Course
Help To Grow 25 Sep 2026 - 15 Dec 2026

Help to Grow: Management Course

University of Lancashire, Preston, PR1 2HE

09:30 - 12:00

Commercial Planning Application workshop
Commercial Planning Workshop 20 Oct 2026

Commercial Planning Application workshop

Online, Accrington , BB5 0PF

12:00 - 13:00

They’ve Already Decided About You – Sales Geek Sales Club: how buyers judge you before you speak – and what to do about it
Lancaster And Morecambe Logo 1 21 Oct 2026

They’ve Already Decided About You – Sales Geek Sales Club: how buyers judge you before you speak – and what to do about it

Lancaster & Morecambe College, Lancaster, LA1 2TZ

08:00 - 10:00

Mock Tribunal - step inside an employment tribunal… without the risk
LBV Website Events GraphicMock Tribunal 21 Oct 2026

Mock Tribunal - step inside an employment tribunal… without the risk

Online, Preston, PR1 3JD

09:30 - 12:30

Preston Freelancer Meet-Up: October
Freelance Meet Up 22 Oct 2026

Preston Freelancer Meet-Up: October

Society1, 9-10 Cross Street, Preston, PR1 3LT

10:00 - 12:00

North West Business Expo
LBV Website Events GraphicBusiness Expo 1 23 Oct 2026

North West Business Expo

Toughsheet Stadium , Bolton, BL6 6JW

09:00 - 15:00

Girlie Night Out
Lancaster And Morecambe Logo 1 23 Oct 2026

Girlie Night Out

Lancaster Brewery, Lancaster, LA1 3LA

19:00 - 23:00

Lancashire Finance Leaders Forum: The Autumn Budget in Focus
ian-UmTFcwHLPC0-unsplash.jpg.jpg 29 Oct 2026

Lancashire Finance Leaders Forum: The Autumn Budget in Focus

Farington Lodge Hotel, Stanifield Lane, PR25 4QR

08:00 - 10:00

The PM+M Autumn Budget seminar - East Lancashire
Autumn Budget 2026 LBV 29 Oct 2026

The PM+M Autumn Budget seminar - East Lancashire

Blackburn Rovers Football Club (Premier Suite), Blackburn, BB2 4JF

08:00 - 10:30

Blackburn Budget Breakfast 2026
LBV Website Events GraphicBudget Breakfast 30 Oct 2026

Blackburn Budget Breakfast 2026

Premier Suite, Blackburn Rovers FC, Blackburn, BB2 4JF

07:30 - 10:30

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 LBV130 Online GraphicWebsite
Subscribe now

Weekly news bulletin