What are Contracts of Employment?

Contracts of employment are the agreements made between an employer and the employee which govern their relationship and set out the terms of the working relationship.

Do I need a Written Contract?

It is not mandatory to have written contracts of employment to evidence the agreement between an employer and an employee but it is advisable. However, the law does state that it is a requirement that an employer provides an employee with a statement of their main terms and conditions of employment. The statement is not conclusive evidence of a contract of employment, but it must cover the following:

• The name of the employer and the employee
• The date the employment began
• The date the continuous employment with the employer began
• The scale or rate of pay, the method of calculating pay and the intervals at which an employee will be paid
• The hours of work
• The place of work
• Any terms relating to holiday entitlement and the accrual of holiday
• Any terms relating to incapacity and entitlement to sick pay
• The length of notice each party must give to terminate the contract
• The job title or a brief description of the work to be carried out by the employee
• Whether any collective agreements apply to the employee
• The employer’s disciplinary and grievance rules
• Any terms relating to the provision of a pension by the employer
• If the contract isn’t permanent then it should specify the period for which it is expected to continue

When do I have to give this statement to my employee?

The statement must be given to the employee within 2 months of them commencing employment and notification of any changes must be given to the employee within 1 month. An employee can complain to an employment tribunal if an employer fails to provide them with a statement of main terms and conditions.

The statement can cover other issues which an employer may wish to include such as the right to put the employee on garden leave or pay them in lieu of notice rather than having them work the notice. This is why many employers choose to have formal contracts of employment as it enables them to ensure that they not only comply with their obligations under the Employment Rights Act 1996 but also ensure that they and the employee understand the nature of their relationship and their obligations to one another.

Any ambiguity can lead to misunderstanding and disputes and it is therefore advisable for both the employer and the employee to give careful consideration to the terms which will apply to the employment relationship and to record these in writing. Written contracts of employment can help to avoid any uncertainty and ambiguity.

What is a Staff Handbook?

A staff handbook is a written document which details working practices, expectations and procedures which an employer may expect an employee to comply with. A staff handbook should be given to an employee in addition to their contract of employment. It can cover lots of issues specifically tailored to a business, such as equal opportunities, dress codes, family-friendly rights and guidelines for the use of motor vehicles.

A staff handbook will also avoid any misunderstandings and ambiguity arising and properly enforced and monitored will ensure that policies and working practices are being applied consistently.

Do you prepare contracts of employment?

We do prepare tailored contracts and handbooks for many clients. We would assess your needs and draft contracts, policies and procedures which work for your organisation. We charge a fixed fee for this ranging from £250-500 plus vat depending on the complexity. If you are a Watertight HR & Legal client you will have these drafted free of charge.