The Importance of Contracts of Employment

As an Employer It is a legal requirement for you to provide a ‘Written Statement of Employment Particulars’ to all Employees and Workers employed on or after 6 April 2020, this document must be issued on or before their first day of employment with you.

 

What is a written statement of employment?

 

The Written Statement of Employment Particulars (in accordance with section 1 of the Employment Rights Act 1996, referred to in legislation as a section1 statement; is a document which sets out the key terms of the relationship between you the Employer and Employee.

 

Is there a difference between a Written Statement of Employment and a Contract of Employment?

 

Contrary to popular belief, is important to remember that a Written Statement of Employment does not necessarily constitute a Contract of Employment.

For example, as an Employer, you may agree on the terms in writing with your Employee and this provides evidence of those terms, wider terms may be verbal and form part of a Contract of Employment. We never advise this as verbal Contracts of Employment are problematic and invariably lack substance, this can lead to claims being brought against you and it can be problematic establishing whether a breach has occurred or not.

 

We have detailed below for you the details you need to add into your document that is required on or before your Employees 1^st day but it is worth noting they have the right to a more stable contract within 2 months, it would be wise and practical for you to provide the full version, this includes more detailed information than is required to be included in the Written Statement of Employment.

 

At HR and You Ltd we only ever advise and that you provide the fuller document, this incorporates the requirements of the Written Particulars of employment and that this document is provided within the specified timeframe. Where both documents are provided it is worth noting that the Contract of Employment would be the prevailing document, superseding the terms set out in the Written Statement of Employment.

 

What are the timeframes for issuing the document?

 

It is important to remember that legislation changed on 6 April 2020, from that date all Employers must now provide their Employees and Workers a ‘Written Statement of Employment’, on or before their 1^st day of employment.  Please note this applies to all Employees regardless of their status, which includes Zero hours, Temporary, Fixed Term Employees, it also includes Workers.

 

We advise that preparations are made at the recruitment stage and at the very latest once the conditional offer letter has been sent out and the candidate has accepted the offer of employment.

While these changes do not apply retrospectively, from 6 April 2020 any current Employees and Workers will be entitled to request a written statement including the additional information as detailed in the changes in legislation. As an Employer, you will need to comply with requests from existing Employees within one month.

 

What information is required in the written statement?

 

The new legislation distinguishes between information that must be provided in a single document and information which can be in a supplementary statement (to which the principal statement refers).

We have highlighted the new changes which took place on 6 April 2020 in bold:

Below details the information which must be provided in the single document, this is referred to as the ‘Written Statement of Employment’:

 

• Names of Employer and worker or Employee
• Date employment or engagement commenced
• Date of continuous employment with Employer
• Rate of pay and frequency (weekly, monthly, etc.) of payment
• Hours of work (including normal working hours, days of the week, and whether hours/days are variable (and, if so, how they vary))
• Entitlement to holidays (including public holidays) and holiday pay
• Any other benefits (including non-contractual benefits)
• Length of notice of termination required from Employer and Employee, or Worker
• Job title or brief description of work
• If applicable: Details of non-permanent employment or engagement (e.g. period of fixed-term, Temporary, or Seasonal contract)
• Any probationary period which starts at the beginning of the engagement, including conditions and duration
• Place of work and address of Employer
• Where applicable: if the Employee or Worker is required to work outside the UK for over a month: arrangements for working outside the UK (including period, the currency of pay, additional pay, and benefits, and return terms)
• Any part of any training entitlement which the employer requires the worker to complete
• Any training which the employer requires but does not pay for

 

Below details the information which can be provided in a separate document, please note there is a risk of forgetting to issue this at a later stage:

 

• Sick leave and pay
• Any other paid leave
• Pensions and pension schemes (this information can be provided within 2 months)
• Details of any collective agreements directly affecting terms (this information can be provided within 2 months)
• Any other training entitlement (this information can be provided within 2 months)
• Disciplinary and grievance procedures (this information can be provided within 2 months)

 

Finally, the document must also specify where information about sickness payments, disciplinary and grievance procedures can be obtained, this maybe your Employee Handbook, your HR noticeboards, or internal systems.

 

What can happen if as an Employer you fail to comply with legislation?

 

Failing to comply with the legislation governing Written Statement of Employment Particulars, either by not providing your Employees and or Workers pursuant to the legislation, namely, section 1 of the Employment Rights Act 1996 or not including the requisite information, could even lead to an employment tribunal claim against you the Employer, although compensation will only be granted to the Employee if they successfully bring another claim at the same time, for example, unpaid wages. The amount of compensation awarded to your Employee can vary from two to four weeks’ pay and is capped at the New 2021 Statutory Limits.

 

What action should you take as an Employer now?

 

We strongly advise that your Contract documentation is reviewed, you should do this with any template Written Statements, or existing Contracts of Employment that are used in your workplace, we are sure that if you have not updated these in the last 12 months, they will not be legally compliant.

 

You must only use documents that are legally compliant that any documents meet and comply with the new 6 April 2020 requirements.

We cannot stress the importance enough of legally sound documents, recently we have noted documents that have been provided by legal experts, these only cover the basic ‘Written Statement’ only and not the full terms, these areas are easily overlooked if not provided on day one, it is so easy to forget to issue the fuller terms in 2 months.

 

As an Employer you do need to consider whether your workforce is made up of Employees or Workers, perhaps, it is a combination of both Each of the documents needs to be separate, they should be drawn up for your Employees and for the Workers. It is imperative that as an Employer you do remember that Workers do not have the same rights as Employees but providing them (for example, through the terms of the written statement) could give a Worker the same Employee-status.

 

How can we help you?

We only issue the fuller version of the ‘Written Statement of Employment Particulars’ – we do not issue any shortened versions, we do this to ensure that your Employees and Workers have legally compliant documentation issued on or before their 1^st day of employment with you, we ensure that all areas that you need to be included are covered and above all that you remain legally compliant.

 

We also provide you with the correct template documentation for any Workers that you have working with you, these ensure that you remain legally compliant.

As employment law specialists, we can assist if you have any queries relating to our latest news or any other HR or Employment Law matter please do not hesitate to get in touch. You can book straight into our calendars from here today.

Author

Fran Crossland

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