Employment contracts - are they necessary?
Hiring a new member of staff is an exciting time for an employer. A prudent employer will make sure that they avoid any future misunderstandings or disagreements regarding employment terms with their latest recruit by providing details of their main conditions of employment.
Employees want to start on the right foot and to know what is expected of them and providing detail of their main terms and conditions of employment, enables this to happen.
Is an ‘employment contract’ necessary?
An employer must give employees a document stating the main conditions of employment when they start work. This is known as a ‘written statement of employment particulars’ or a ‘section 1 statement’.
This does not necessarily have to be an ‘employment contract’ but a good employment contract will clarify the conditions, rights, responsibilities, and duties of the employee whilst they are employed and is therefore highly recommended.
Are employees entitled to an employment contract on the first day of employment?
From 6 April 2020 employers need to provide a written statement of particulars to all workers (and not just employees). The statement needs to be included in one document (which could be a section 1 statement or an employment contract) and needs to be provided to workers from the day they start employment.
What should an employment contract include?
A section 1 statement or an employment contract should include:
· the employer’s name
· the employee or worker’s name
· the start date
· the date that ‘continuous employment’ (working for the same employer without a significant break) started
· job title, or a brief description of the job
· the employer’s address
· the places or addresses where the employee or worker will work
· pay, including how often and when
· working hours, including which days the employee or worker must work and if and how their hours/days change
· holiday and holiday pay, including an explanation of how its calculated if the employee or worker leaves
· the amount of sick leave and pay
· any other paid leave (e.g., statutory maternity, paternity, adoption leave)
· any other benefits, including non-contractual benefits such as childcare vouchers or company car schemes
· the notice period
· how long the job is expected to last (if temporary or fixed term)
· any probation period
· if the employee will work abroad, and any terms that apply
· training that must be completed by the employee or worker, including training the employer does not pay for.
Other recommended clauses for employment contracts
The following additional clauses are also recommended:
· confidentiality
· company property
· data protection
· post termination obligations (e.g., restrictive covenants)
· social media
· disciplinary & grievance
Can an employment contract be breached?
It is essential for employers to have a comprehensive employment contract to avoid acting in breach of contract. For example, if an employer places an employee on garden leave but there is no contractual term giving them that right, then they will be acting unlawfully by asking them to remain at home following their resignation.
Alternatively, an employer may want a resigning employee to leave with immediate effect but will be acting unlawfully unless the employment contract contains a clause relating to pay in lieu of notice (PILON).
Whether you are an employer or an employee the team at Barnard & Webb can help you with your employment contract.
For more information, please feel free to contact us on 01442 531021 or by email: info@barnardwebb.co.uk.
The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. The law may have changes since this article was published. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances.
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