The employment contract provides the basis of your employment relationships and is governed by employment legislation.  You don’t want to get this one wrong and end up in an employment tribunal.  We set out some of the basic requirements around employment contracts. 

What is an employment contract?

An employment contract is an agreement between two parties. For a contract to be legally binding it doesn’t have to be written, verbal agreements can be binding too. However good practice would dictate a written document is best to avoid any misunderstandings. 

For a contract to be binding there needs to be intent by both parties for it to form a legally binding contract. There needs to be an offer and something in return for that offer - for example, labour in return for pay.  The contract then sets out all the terms and conditions governing that agreement.

When do I need to issue an employment contract?

Once you have made an offer of employment you should follow it up with an offer letter. This offer letter forms part of the employment contract so it’s important it is accurate. The contract can accompany the offer letter or follow shortly afterwards. 

You may want to get the letter out first so that the new employee has something in writing so that they can resign from their existing job.  Ideally they need to have it before they start so any contract negotiations are done and dusted before day one.

Video: Can I change an employment contract?

ACAS

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The short answer is yes. But to avoid any risk of a legal case against you, it needs to be done with the agreement of the employee. Remember that a contract is an agreement, therefore no part of the contract should be changed by either party without the agreement of the other. This is why it is important to consider any future changes to the organisation when writing the terms and conditions of the contract to ensure that there is some element of flexibility without being so flexible the term is unenforceable by law for being too unreasonable.

Watch the following video by advisers from the Acas helpline to find out more. 

What is a written statement of particulars?

A written statement of particulars outlines the main terms and conditions of employmnent. It does not need to necessarily cover all the employment terms, but it should include the main conditions of employment.

Any member of staff whose employment contract lasts for than one month must be given a written statement of particulars. As an employer, you will need to provide this document within the first two months of the start of employment. 

This table lists items that must be included in the statement of particulars and what doesn't need to be included in this particular document:

Must includeMust includeDoesn't need to include
The business’s nameThe employee’s name, job title and start dateDetails of sick pay policy
Date of continuous employmentLength of jobFull disciplinary and dismissal procedures
End Date for Fixed TermWhat the period of notice for both partiesFull grievance procedure
PensionAny collective agreementsWho the manager is
The salaryWhen the salary will be paidManager's contact details
Hours of workAnnual leave entitlementMaternity and Paternity rights
Location of employmentRelocation requirements 
Employer’s addressAny additional places of work  
Who to go to with a grievanceHow to complain about the way a grievance has been managed 
How to complain about a disciplinary or dismissal decision  

 

Visit the ACAS website at www.acas.org.uk for more information.

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Quiz: When do I need to issue a written statement of particulars?

Do you how long an employer has to provide a member of staff with a written statement of particulars? Select one answer from the list below. 

Whilst it might seem like a long time, the Employment Rights Act 1998 is quite generous and gives you up to two months to issue the written statement of particulars.

This is the correct answer. Whilst it might seem like a long time, the Employment Rights Act 1998 is quite generous and gives you up to two months to issue the written statement of particulars.

What are the different types of employment contract?

Continuous / Permanent  This is a contract with no fixed end date.  This person is your employee and works either full or part time hours.

Fixed Term  This is a contract for a specific length of time.  It has a clear start and end date.  There is a limit to how long you can keep someone on a fixed term contract before they automatically become permanent.

Zero Hours There is much controversy around these contracts.  They might be best described as an agreement for one party to make themselves available for work from time to time and the other party to offer work if any is available from time to time.  They seem to work best in industries impacted by significant seasonal fluctuations in demand.

Next Steps

Read more on employment contracts and written statements of particulars on GOV.UK

This guide runs through contract terms, collective agreements, written statement of employment particulars, and potential problems with a written statement.

Read more

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