Q&A: Employment contracts – the basics

Contributor - Jonathan Dale

Overhead shot of an employer handing over a pen and an employment contract

Jonathan Dale of Andrew Jackson solicitors explains employment contracts, what a written statement of employment must contain and the importance of honouring the terms of employment

At what point does an employment contract exist?

As soon as you offer someone a job - even verbally, if they accept. Contract terms can be verbal, written or implied, but having a written contract removes any doubt on either side about what is expected. If you don't give your employees an employment contract, you must at least provide them with a written statement of employment.

When must I provide a written statement of employment?

You must provide all workers and employees with a written statement on or before the first day of work. It's not an employment contract, but it details the key employment terms and conditions, which is useful should any disagreements arise, especially if the matter goes to an Employment Tribunal. If it contains all the information usually found within a written statement, issuing an employment contract is sufficient.

Must I provide a written statement to everyone who works for me?

The right to a written statement was extended to all workers on 6 April 2020 as part of the 'good work plan'. Previously you only had to provide a statement to employees within two months of work commencing.

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What should I include within the written statement of employment?

Key employment particulars can be contained in a 'principal statement'. This can be part of the employment contract. The principal statement should include:

  • name of employee and business;
  • job title, description and start date;
  • details of any probationary period;
  • location, hours and days of the week the worker is required to work and whether they can be varied and how;
  • details of pay (including amount and frequency);
  • holiday and paid leave entitlement;
  • any benefits not covered elsewhere in the statement;
  • details of any employer-provided training;
  • notice period;
  • grievance, disciplinary and dismissal procedures (or where to find details);
  • sick pay (or where to find details);
  • length of employment (if fixed term or temporary);
  • pension details;
  • details of any relevant collective agreements.

What if I don't provide a written statement of employment?

An employee can refer you to an Employment Tribunal, which they can also do if you don't get their agreement before changing their written statement. If an employee successfully brings another claim against you, you can also be made to pay further compensation for not providing a written statement of employment or changing terms with agreement.

What are the 'implied terms' of an employment contract?

Provisions that an employee can rightfully expect to exist without being expressed, such as a safe and healthy workplace. Other implied terms include that the employee should be honest and loyal, a relationship of trust and confidence between them and you, etc. Many rights - such as paid holidays, fair and equal treatment and National Minimum Wage - are statutory, so the employee also has the right to expect these.

Can I change my employees' contracts?

Not without their written agreement. Otherwise, they could take legal action against you for breach of contract - or resign and claim constructive dismissal. If you want to change a written statement, you must consult with your employees first. Explain to them the reason for wanting to make the change and seek their written agreement.

At what other times can I be guilty of breach of contract?

If an employee suffers loss because you don't observe the terms of their employment contract, a tribunal could award an employee damages. However, you might be able to make a counter-claim if your business has suffered as a result of the employee's failure to obey their employment contract terms.

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Jonathan Dale

Jonathan has practised exclusively in the field of employment law for 20 years.

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