Statement of terms
All employers are legally required to provide employees with a statement of terms within two months of that employee’s start date. The statement of terms is a bare legal minimum that should cover the main terms of an employee’s contract, including job title, wages, hours of work, holiday entitlement, sick pay, pension schemes, notice, grievance, dismissal and disciplinary procedure.
Why use a contract
While the statement of terms is a legal requirement, a contract of employment is not. However, most employees will expect a professional organisation to provide a full employment contract and a comprehensive contract provides an extensive set of protections for an employer too. The contents of the contract are up to employer and employee, but neither can agree to a contractual term that gives the employee fewer rights than they have under law. If you opt for a contract then the statement of terms should be included as a schedule.
Express and implied clauses
It’s worth noting that most employment contract clauses will be express i.e. written in the contract. However, there are some clauses that are implied, whether by law, by custom and practice or from agreements made with a trade union or staff association.
There are a number of clauses that we have become used to seeing in a contract of employment and these operate to give employees rights and to ensure that employers are protected. These include:
Pay – amount of wages, entitlement to overtime, details of bonus pay. This can also include pay in relation to leave, such as maternity, paternity, adoption, holiday, sick pay and redundancy pay, over and above the statutory entitlements.
Hours/entitlements – how long is an employee required to work each day, what are the overtime hours (remember most employees have a legal limit of 48 hours a week), what is the annual holiday entitlement, is there a limit to annual sick pay payouts?
Details – what is the start date of the contract, where is the usual place of work and who are the parties to the contract? The document should also include details of the job title and job description, including as much information on what the employee is required to do on a daily basis.
Probation, disciplinary and notice – is there a probationary period attached to the contract, if so how long does it last and what does an employee need to do in order to pass it? What kind of notice period can employees expect if they are asked to leave and what notice does the employee need to give if they want to move on elsewhere? It’s a good idea to include in this clause a list of scenarios in which an employee might find themselves being asked to leave and/or to incorporate a mention of a staff handbook that details unacceptable behaviours, disciplinary and grievance procedures.
Restrictive covenants – these are essential for employers as they provide a range of protections for confidential and commercial information, prevent an employee from establishing a competing business while employed, and for a specific period afterwards, as well as preventing poaching of other employees and stating the employer’s right to seek redress.
Get help writing contracts by giving Goodharts Solicitors a call today on 0191 206 4103.