Writing an employment contract

Posted 5th June 2014

Written by Newtons Media Team

Employers are legally obliged to provide a written statement of the main terms and conditions of employment to each member of staff within the first two months of employment.

That said, once an employee has started work then they have an employment contract even if there is nothing in writing.

By putting an employment contract in writing both parties can avoid any misunderstandings or disagreements that may occur during the course of employment. It makes it clear for both parties what their rights and obligations are.

Employment contract essentials:

• The employee name and employment start date.

• The employer name

• The job title or a brief job description.

• The address of the place of work and address of any other places the employee is expected to work at.

• The employee´s salary and any specific pay scales or rates.

• When the employee will be paid.

• What the hours of work are.

• The holiday entitlement including holiday pay, entitlements and accrued holiday pay entitlements.

• The terms and conditions regarding provision of sick pay and what happens when an employee is unwell or injured.

• Details of any pension schemes offered by the employer

• How much notice an employer needs to give an employee to terminate employment and how much notice an employee needs to give an employer.

• If the employment isn’t intended to be permanent, details of how long it is expected to last.

• Any details regarding whether an employee has to work outside of the UK for any periods and what the conditions will be and if there will be any extra pay or salary for this work.

• An explanation of what the employer´s grievance and disciplinary procedures are should be included in employment contracts. The employee should also be made aware in the contract where they can go to read about or find out about more information regarding this area.

• Details of any collective agreements which may apply to the employee’s work.

Terms used in employment contracts

An employee’s contract terms may come about in a number of ways, such as::

Statutory – these are terms that by law must be imposed and regulated. An example of this could be the statutory minimum notice period required. Statutory terms will override terms agreed between the parties, e.g. legal minimum notice periods or the National Minimum Wage can override clauses in the contract on notice or pay rates.

Implied – these are terms which are implied into the contract, but not necessarily put down in writing.

These terms may be patently obvious, such as the expectation that an employee should not steal things from an employer. Otherwise, the terms could be implied by custom and practice, for example a cash bonus paid every Christmas without fail or may be implied based upon industry norms.

Express – these are terms that have been agreed upon by both parties, whether or not they have been put down in writing.

Incorporated – these are terms that cover items that have been included in employment contracts that have derived collective agreements (for example, those negotiated by a trade union).

Keeping up to date and training It is important for employers to be up to date with current employment legislation, especially relating to employment contracts. It is a good idea to ensure that all managers and those who have human resources responsibility receive the necessary training and up to date skills to ensure all employment contracts cover all essential areas and that employment practices are legally compliant.

Newtons solicitors has a team of specialist employment law solicitors who would love to hear from you to talk about ways in which we can help with the smooth running of HR within your business, including providing you with advice and training. Newtons HR also offers an employment law helpline and online portal giving access to employment law guidance, template letters and flowcharts as well as helping you to manage personnel files, employment contracts and holidays and absences.

Call us on 0800 038 5500.