Contracts of Employment

Contracts of Employment, PicassoHR Ltd, HR Outsourcing Consultancy, Suffolk

From the day that you accept an offer of work it is deemed that you are entering into a contract of employment with an employer.  It doesn’t matter whether it’s by a verbal or written agreement because from that point forward it is a valid and lawful contract.

So, what is a contract of employment? 

The contract is a relationship between a business (the employer) and a worker that establishes the terms both parties agree on.  So, the worker would be providing their skills to perform a role in return for a wage.  Both parties agree what the expectations of the role would be, the obligations to enable the role to be fulfilled and of course, employment rights which are governed by law.

Is a written contract necessary?

A worker doesn’t have to have a written statement for a contract to be lawful.  However, it is better if the employer provides a statement of the main terms and conditions of the employment within two months of the acceptance of the offer.

The statement should contain information relating to the role such as:

  • your business’s name
  • the employee’s name, job title
  • if a previous job counts towards a period of continuous employment, the date the period started
  • If it’s a temporary or fixed term contract, how long it’s expected to last
  • Salary and pay date
  • hours of work and what days they will have to work.
  • holiday entitlement (and if that includes public holidays)
  • The location the employee will be working from and whether they might have to work at other sites or relocate
  • notice periods
  • collective agreements
  • Company benefits (including pension arrangements)

Your document doesn’t need to include details of sick pay, disciplinary, dismissal or grievance procedures, but it is useful say where the information can be found.

It is also useful to provide the employee with a statement of the job role so that they know what is expected.

Does the contract have to be signed?

No, it does not. Just because a contract of employment is unsigned – or even unwritten – does not mean that the terms of employment have not been agreed between the two parties.  It doesn’t give either side free rein to change its provisions either.  An employee without a written contract should not be treated any less favourably than an employee who does have a formal written contract.

If you find yourself in a situation where by you do not have a written contract and do not know what to do next, ask your HR department for advice as they can advise you on the best way forward.