What is a Contract of Employment?

A contract of employment exists as soon as an employee starts work, thus indicating that he or she accepts the terms and conditions offered by the employer.

Often the contract is agreed orally and is not written down. However, an employer is usually required by law to give all employees who have been in employment for at least one month, written details of the main particulars of their employment.

This written statement of employment particulars need not necessarily cover every aspect of the contract of employment, but it must detail:
  • the names of the employer and the employee;
  • the date when the employment (and the period of continuous employment) began
  • the level of remuneration and the intervals at which it is to be paid
  • the hours of work
  • the employee’s holiday entitlement
  • entitlement to sick leave, including any entitlement to sick pay
  • pensions and pension schemes
  • the entitlement of employer and employee to notice of termination
  • the job title or a brief job description
  • where it is not permanent, the period for which the employment is expected to continue or, if it is for a fixed term, the date when it is to end.
  • either the place of work or, if the employee is required or allowed to work in more than one location, an indication of this and of the employer's address
  • details of the existence of any relevant collective agreements which directly affect the terms and conditions of the employee's employment - including, where the employer is not a party, the persons by whom they were made.

Additional information must be included if the employee is expected to work outside the UK for more than one month.

The statement must also provide certain details of the employer's disciplinary and grievance procedures, and state whether or not a pensions contracting-out certificate is in force.

All the required particulars of employment must be given to the employee within two months of the date when the employment begins. If required, the information does not have to be given all in one document at the same time. Instead, it can be given in separate documents or instalments if this is more convenient, provided that certain particulars are collected together in one single instalment, referred to in employment legislation as the 'principal statement'.

Do all your staff have written statements of their employment? If not, click here to create an individually tailored contract online - free of charge!

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