What must an employment contract contain?
An Employment Contract is a key document setting out the rights, the relationship, and the obligations of both the employee and the employer. This article sets out the terms that are required by law to be in a contract of employment.
The right to a written statement of employment particulars
All employees (and workers) have a statutory right to be given a written document containing the key provisions of their employment – this is legally referred to as a Section 1 Statement but more commonly referred to as an employment contract.
This must be provided on or before the employee’s first day of employment.
Who should receive a written statement of employment particulars?
All those with the status of worker are entitled to receive a written statement of employment particulars (including apprentices).
This is irrespective of the length of intended employment.
What should the written statement of employment particulars contain?
The following information must be included in one single document.
✔️ The names of the employer and the worker;
✔️ The date when the employment began;
✔️ The date on which the employees continuous employment began;
✔️ Whether the employment is permanent or where it is a fixed term, the date it is to end;
✔️ If any probationary period is applicable;
✔️ The job title or a brief description of the type of work they are employed to do;
✔️ The hours of work including normal working hours, the days of the week and whether or not these hours or days are variable and if they are, how they vary or how the variation will be determined;
✔️ The address of the employer, place of work and/or where the worker is required to work at various locations;
✔️ Whether the worker will be required to work outside of the UK for a period of more than one month;
✔️ The scale or rate of pay;
✔️ When the worker will be paid (i.e. weekly, monthly or other specified periods);
✔️ Statutory and contractual holiday entitlement;
✔️ How holiday pay is determined;
✔️ Terms and conditions relating to incapacity for work due to sickness;
✔️ Provisions relating to sick pay;
✔️ Provisions relating to any other paid leave;
✔️ Provisions relating to any contractual and non-contractual benefits;
✔️ Whether the worker is required to complete any training and whether the employer will bear the cost of such training; and
✔️ The length of notice the employer and employee is required to give and receive to terminate the employment.
If there are no particulars in relation to any of the prescribed particulars, that fact must be stated. For example, if there is no probation period for the contract of employment then a simple sentence stating this should be included in the statement.
Particulars that can be given later
In addition to the main statement, some particulars can be given to the worker at a later date, but no later than two months after the beginning of their employment.
These include:
Information about pension and pension schemes;
Whether any collective agreements directly affect the contract;
Any training entitlement provided by the employer;
Any disciplinary rules or procedures applicable to the worker;
The person to whom a worker can apply if they are dissatisfied with any disciplinary decision relating to them;
The person to whom a worker can submit a grievance to and how to do so; and
How to appeal a disciplinary or grievance decision.
If the above are provided separately, the written statement of particulars of employment can simply refer the worker to another document which contains these further details (e.g. a Staff Handbook). These additional documents must be reasonably accessible, and the worker must have reasonable opportunities of reading these documents (and any updates to them) during their employment.
When can a statement be changed?
If there are any agreed changes to any particulars in a written statement, the statement must be amended no later than one month after the change in question.
What can a worker do if their employer never provided a written statement of employment particulars?
If an employer fails to provide a worker with any written statement of employment particulars or one that is not compliant with the law, a worker can request the Employment Tribunal to make a reference. The Employment Tribunal may:
✔️ Confirm the particulars as included or referred to in the statement given by the employer;
✔️ Amend the existing particulars; or
✔️ Substitute other particulars.
There is no time limit for making a reference to the Employment Tribunal whilst a worker is still employed. If the employment has terminated, the worker must make a reference to the Employment Tribunal within three months of the date the employment has ended.
Is a worker entitled to compensation for their employer failing to provide a written statement of employment particulars?
In order for the Employment Tribunal to make an award to the worker for their employer failing to provide them with a written statement of employment particulars, the worker must have a claim listed in EmA 2002, Sch 5 (essentially must have a claim already, e.g. for unfair dismissal), and the Employment Tribunal must find the claim in favour of the worker.
If these circumstances are met, the Employment Tribunal can then make an award of two to four weeks capped pay, depending on the circumstances which would make it unjust or inequitable to do so.
Other Considerations
Whilst the above guidance sets out what MUST be provided to a worker and if provided correctly should mean an employer has met their legal obligation, these particulars are only the bare minimum and do not provide much protection for an employer on a commercial level.
Provisions protecting an employer’s confidential information and intellectual property are strongly encouraged to be inserted into all employment contracts. Additional provisions such as restrictive covenants, caps on sick pay and paying notice in lieu are other commercial provisions we recommend are inserted and often are ones which investors request are included when they are looking to invest in your business.
Protect your business further, don’t just meet the bare minimum – if you would like us to carry out a free audit of your employment contract to determine whether your employment contract opens your business to risk, send a copy of your template contract to legal@dragonargent.com and one of our employment solicitors will be in touch!
If you would like to discuss any other employment law related topics or questions, book a discovery call with one of our employment solicitors by clicking the link below.
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