The contract of employment is a crucial document between the employer and employee and lays out the primary terms and conditions of an individual’s employment with a company.
Whilst contracts can exist verbally, rather than in writing, The Employment Rights Act 1996 (ERA) specifies that a written statement of terms and conditions of employment needs to be issued to all employees within 8 weeks of the commencement of employment. For the avoidance of doubt the use of the word contract within this article references the written statement.
The ERA specifies that certain information that must be included in the contract, such as:
The employees start date
Where a previous role counts toward continuous employment, you must specify the date the continuous employment started. This may well apply where an employee has transferred by way of a merger or acquisition.
If a role is temporary, how long it is expected to last.
The end date of a fixed-term contract.
How much holiday entitlement applies and whether this includes public holidays.
Where the place of work will be and whether there is likely to be any relocation of the workplace.
If an employee works in different places where these will be.
How much notice will be given to the employee to end their employment.
How much notice the employee needs to give to end their employment.
Details of any pension provision and you now need to ensure that this is worded appropriately for your auto-enrolment obligations.
This list isn’t the complete list of all the obligatory considerations and there are many more and therefore it is advisable to get advice about other important inclusions for your business. You may find yourself restricted in some areas if you haven’t adequately drafted your contract.
For example you may have uniforms that are the employees responsibility to cover the cost of or are subsidised by the employer, there are important arrangements to cover within contracts. Additionally, you may have working patters that need to be covered within the contract such as overtime arrangements and night time working.
You may also wish to expand on some of the basic inclusions, such as holiday but putting stipulations in about carrying forward holiday etc. but again, bear in mind obligations around the Working Time Regulations and the minimum amount of leave to be taken in 12 months.
Contracts are the single most important document in the employment relationship and govern the relationship between employer and employee so it is imperative that these are carefully drafted for your organisation, not just a template from the internet or an advice service which takes a ‘one-size, fits all’ approach.
If you are an employer and need ongoing assistance with staff and employment matters, talk to Cheryl at PeakHR. We offer competitive rates and cater specifically for small employers.
Please note our blog posts contain general information and are intended as guidance only and should not be taken as an authoritative or current interpretation of the law. Please ensure that you obtain advice tailored to your individual situation before taking action. These posts apply to the UK only.