Team Relocations: Guide for Employers

Team relocations involve moving a group of employees to a new workplace location, either permanently or temporarily. Such moves may be driven by business needs, such as reducing costs, accessing new markets or consolidating operations.

While relocations can offer benefits for organisations, they also present challenges for both employers and employees. As such, you will need to proceed with care with any relocation process to protect the business against loss of key personnel and potential tribunal or breach of contract claims.

In this guide for employers, we explain the key employment law considerations if staff relocations.

 

The law on team relocations

 

In the UK, the law on team relocations primarily revolves around employment contract terms, particularly mobility clauses, and broader employment rights such as consultation, fairness, and redundancy procedures.

 

Mobility clauses

 

The employee’s contract of employment (or written statement of particulars) should state the employee’s ‘normal place of work’. A mobility clause is a provision within a contract of employment that seeks to permit the employer to move the employee’s normal place of work, either permanently or temporarily.

Mobility clauses are generally included within employment contracts as standard, with the employee agreeing to move within certain limits, such as a specific time or distance away from their normal place of work. This means that employers can normally require their employees to move to places that fall within the scope of the clause although the relocation must be considered reasonable for the clause to apply.

When an employer is planning to relocate staff, and the employee has an express mobility clause in their contract of employment, the employee would be legally required to accept the move (‘forced relocation’), unless they can prove the request is in some way unreasonable, such as for financial reasons or because it would cause severe disruption to family life. By way of example, it would be unreasonable to ask an employee to move abroad on very short notice, whereas it may not be unreasonable to expect them to move to different premises in the same city or region.

If the employment contract does not have a mobility clause within their contract of employment, the employer would need to get agreement from the employee to relocate. There will be no obligation on the employee to accept the relocation.

If the relocation forms part of a transfer and the TUPE regulations apply, the employee’s rights and entitlements under their existing contract would typically be preserved.

 
What is ‘reasonable’?
 

The existence of an express term in itself is by no means conclusive as to whether you can make an employee move. Relocations must be considered ‘reasonable’. What is reasonable will depend on a number of factors such as travel time to the new location, the distance from the original workplace, the cost of relocation for the employee and the impact of relocation on the employee. Consider also that what is reasonable for one employee may not be for another, for example, someone with caring responsibilities at home may not be able to travel further away to work each day, and requiring more senior personnel to relocate is likely to be more reasonable than junior staff.

The wording of the clause will also be important; the term should specify parameters for relocation, such as time and distance from the original place of work, but if the clause is drafted widely, it can become a matter of interpretation.

 

Consultation

 

UK employers are legally obligated to consult employees before making decisions about team relocations, even if the relocation is permitted under a mobility clause in their contracts. Consultation ensures employees understand the reasons for the move and provides them with an opportunity to express concerns or suggest alternatives.

For individual relocations, consultation must be meaningful and take into account the personal circumstances of the affected employees. Employers should provide clear information about the proposed changes, including the timeline, new working arrangements, and any available support, such as relocation allowances.

If the relocation affects 20 or more employees and redundancies may occur, employers must comply with collective consultation requirements under the Trade Union and Labour Relations (Consolidation) Act 1992. This involves consulting with employee representatives or trade unions at least 30 days before the first redundancy if 20-99 employees are affected, or at least 45 days for 100 or more employees.

Failure to conduct proper consultation can lead to claims of unfair dismissal, even if the relocation is legitimate. Employers must show they considered employee feedback and explored alternatives, such as flexible working arrangements or redeployment. Documenting the consultation process is essential to demonstrate compliance with legal requirements and fairness.

 

Fairness

 

Employers must approach team relocations with fairness to minimise disruption and avoid potential legal disputes. Fairness requires treating employees equitably, ensuring decisions are reasonable, and acting in good faith throughout the process.

Even if an employment contract includes a mobility clause, employers must assess whether enforcing it is reasonable in the circumstances. Factors to consider include the distance of the relocation, increased travel costs, personal responsibilities such as childcare, and any health-related issues. Employers should also consider offering support, such as relocation allowances, temporary housing, or flexible working options, to ease the transition.

Employers must avoid discriminatory practices during relocations. Under the Equality Act 2010, decisions must not disadvantage employees based on protected characteristics such as age, disability, gender, or family responsibilities. For example, requiring a relocation without considering the childcare responsibilities of a working parent could constitute indirect discrimination.

Clear communication and transparency are key to maintaining fairness. Employers should provide employees with detailed information about the relocation and ensure they are given adequate time to make decisions. Providing an appeal mechanism for those who disagree with the relocation terms can further demonstrate fairness. Employers who fail to act fairly may face claims for unfair dismissal, constructive dismissal, or discrimination.

 

Redundancy procedures

 

If employees are unwilling or unable to relocate and no suitable alternatives can be agreed upon, redundancy may become necessary. Employers must follow fair and lawful redundancy procedures to avoid claims of unfair dismissal.

Redundancy occurs when an employee’s role is no longer required at the current location, and relocation is not feasible. Employers must demonstrate that the redundancy is genuine, linked to business needs such as downsizing or operational changes.

The redundancy process begins with consultation. Employers must inform employees of the reasons for redundancy, explore alternatives (such as redeployment to a different role or location), and provide an opportunity for employees to respond. Even in cases of individual redundancy, consultation must be meaningful and documented.

For redundancies involving 20 or more employees, collective consultation requirements apply. Employers must consult with representatives and notify the government using a Form HR1.

Employees are entitled to redundancy pay if they have been continuously employed for at least two years. The amount depends on their age, length of service, and weekly pay, up to the statutory maximum. Employers should also provide notice in line with contractual or statutory requirements.

Failing to follow proper redundancy procedures, including fair selection criteria and consultation, can lead to claims of unfair dismissal or discrimination. Employers should document each step of the process to demonstrate compliance and fairness.

 

Can an employee refuse a relocation?

 

Employees may be reluctant to relocate for many reasons, such as family commitments or increased travel costs and commuting time.

If the employee has a mobility clause in their contract, they will generally be required to move with their employer, unless the request can be shown to be unreasonable. It will be for the employee to establish that the relocation should be considered unreasonable.

The employer will not be required to offer compensation for the move unless the contract specifically states this.

If the employee’s contract does not include a mobility clause, they have the right to decide whether to accept or refuse to relocate. In such instances, the employer may attempt to incentivise employees to move by offering an attractive compensation package. This could include contributing to or covering relocation costs and providing a trial period for the relocation.

Employers cannot compel an employee to relocate if their contract does not include a mobility clause or the proposed move falls outside the scope of its provisions. This may be found to be a breach of contract, for which the employee could bring a claim. If the employee resigns as a result of being forced to relocate despite having no mobility clause, they may be able to claim constructive dismissal.

In circumstances where there is no contractual mobility clause, and the employee is refusing to move, you may need to consider bringing the employment to an end. In these circumstances, you have to follow a fair and reasonable process, with dismissal generally through either redundancy or some other substantial reason, or risk tribunal claims.

For example, if the reason for the relocation is that the employee’s normal place of work is closing, redundancy would be appropriate ground for dismissal. In the event of redundancy, the employee has worked for you for a relevant qualifying period and they haven’t unreasonably refused an offer of suitable alternative work they may be entitled to a redundancy payment, provided they will not be receiving compensation for electing not to move.

In some circumstances, it may be appropriate to bring the employment contract to an end with a settlement agreement and mutually agreed terms.

 

Team relocation process

 

When relocating, an employer should always plan in advance and carefully consider how to improve acceptance rates from employees in relation to the move, while remaining both legally compliant and cost efficient.

The best way to achieve this is by ensuring from the outset that any contracts of employment contain clearly drafted mobility clauses which grant you, as the employer, the power to require the employee to change their place of work within a set radius or a city or a particular county or region within the UK, or even to specific international locations appropriate for the business.

However, even where an express mobility clause exists, you should still act reasonably when relying on its provisions, having regard to any impact the relocation could have on the employee.

Once contracts have been considered, the employer should notify affected employees about the proposed relocation in writing, giving as much notice as possible. Ensure you explain the reasons for the relocation and the impact on the business of proceeding with the relocation and not proceeding with the relocation.  You should give employees the opportunity to feedback on the proposal.

The importance of openly consulting and communicating with staff and their representatives before making any relocation decisions cannot be underestimated. Employees should be informed of any proposed move with reasonable notice. This ensures an open process and can help to promote collaboration and discussion above conflict and misinformation and by following a fair process you can ascertain whether or not there are any objections and, if so, how these can be overcome.

 

Relocation packages

 

There is no statutory right for employees to be compensated for relocation costs, but you should check if the employment contract makes provision for any contractual entitlement.

In practice, it often makes sense to incentivise employees with some form of relocation package or by covering certain costs such as travel expenses for an agreed period. This can be helpful to persuade employees who are reluctant to move, and to generally support positive working relations through the period of change.

 

Agreement to relocate

 

In the event you are able to obtain agreement in principle to the proposed move, you will need to agree and make a formal record of the terms of relocation with the employee. A written relocation agreement should, as a minimum, cover:

 

• The duration of any temporary relocation with notice periods
• What rights and responsibilities the employee will have
• Where the relocation is to a different branch or subsidiary of the company, what workplace rules the employee will be bound by
• Who will be responsible for performance management and appraisals, and to whom grievances should be brought
• What benefits the employee will receive, for example, relocation or extra travel costs, as well as repatriation costs where the move is overseas
• The extent to which the employee will be responsible for repaying any relocation costs where they resign shortly after moving
• Where the relocation is overseas, in what currency the employee will be paid and what protection will be offered against exchange rates
• Where the relocation is overseas, what will be the law governing the employee’s contract of employment
• What level of commitment is to be given by the employer that at the end of the relocation there will be the offer of a suitable job to return to and, where there is no such guarantee, how the employee will be compensated
• What trial period, if any, will be in place to allow an employee to reverse their decision to relocate.

 

 

Need assistance?

 

How you resolve a dispute relating to team relocations will largely depend on the circumstances.

If the employee believes the organisation has acted unreasonably in requesting the relocation, they may raise a formal grievance or if they resign as a result of the dispute, they may have grounds for constructive dismissal, provided they have at least 2 years’ service, or they could be able to claim for unfair dismissal if they have been made redundant.

Taking specialist legal advice early in the relocation process can ensure you understand your options when dealing with a staff relocation and protect your interests, should a dispute arise with an employee.

Our employment lawyers are experienced in advising on all issues relating to relocations, including consideration of relevant mobility clauses and varying contractual provisions in line with the new employment terms, as well as providing guidance where an employee does not agree to the changes. For specialist advice, contact us.

 

Team relocations FAQs

 

What is a team relocation?

A team relocation occurs when an employer moves a group of employees to a different workplace location, either permanently or temporarily.

 

Do employers need employee consent for relocation?

If an employee’s contract includes a mobility clause, relocation may be required. However, employers should still consult employees and consider their personal circumstances.

 

What is a mobility clause?

A mobility clause in an employment contract allows an employer to require an employee to work in different locations. The clause must be reasonable to enforce.

 

What happens if an employee refuses to relocate?

Employees without a mobility clause may not be obligated to relocate. Refusal could lead to redundancy discussions or the need for alternative arrangements.

 

Are employers required to compensate employees for relocation?

While not always required, offering relocation allowances or financial support can help ease the transition and improve employee retention.

 

What factors should employers consider before relocating a team?

Employers should assess the impact on employees’ travel time, personal circumstances, and costs. Effective communication and consultation are essential to manage the process fairly.

 

Can team relocation lead to redundancies?

If relocation is not feasible for certain employees and alternatives cannot be agreed upon, redundancy may be considered. Employers must follow fair procedures in these cases.

 

How can employers support employees during a relocation?

Providing clear communication, financial assistance, flexible working options, and adequate time for employees to adjust can help ensure a smooth relocation process.

 

Glossary

 

 

Term	Definition
Team Relocation	The process of moving a group of employees to a different workplace location, either temporarily or permanently.
Mobility Clause	A clause in an employment contract that allows an employer to require employees to work at different locations, subject to reasonableness.
Consultation	Discussions between an employer and employees about the potential impact of a relocation and any alternatives or adjustments.
Relocation Allowance	Financial support provided by an employer to help employees cover costs associated with moving to a new work location.
Reasonable Adjustment	Changes made by an employer to accommodate employees’ needs during a relocation, such as flexible working arrangements.
Redundancy	A dismissal that occurs when an employee’s role is no longer needed due to business changes, such as a relocation they cannot accept.
Flexible Working	Working arrangements that allow employees to adjust their hours or location to accommodate personal circumstances, often used during relocations.
Reasonableness Test	A legal principle assessing whether an employer’s demands, such as requiring relocation, are fair and practical in the circumstances.
Workplace Location	The specific site where employees are required to perform their work, which may change during a team relocation.
Notice Period	The time an employee must be given before changes, such as relocation, take effect, allowing them to prepare or seek alternatives.
Employment Contract	A legally binding agreement outlining the terms and conditions of employment, including provisions for location changes.
Employee Retention	Strategies used by employers to retain employees during challenging changes like relocation, such as offering support and incentives.
Travel Costs	Expenses incurred by employees commuting to a new location, which employers may need to consider during a relocation.