What is an Employment Contract?
A comprehensive employee handbook and/or contract is every employer’s best friend – They ensure that all employees know what is expected of them and reduce the likelihood of future issues or disputes by having written terms of employment & policy details.
It may not be required by UK law to provide a written employment contract, however, employers must provide their employees with a ‘written statement of employment particulars’ within the first two months of employment – This includes the principle statement and a wider written statement, both parties should agree and sign these statements before starting work.
The principal statement should include information such as employer & employee details (name, job title, job location, start & end date), pay details, hours of work, holiday entitlement, how long the contract is for, probation periods, benefits and training information.
In the wider written statement, employers should include details of the pension entitlement and schemes available, any collective agreements made with employees’ representatives (e.g. union representatives), the right to non-mandatory training available and the disciplinary & grievances policies.
Additionally, on the first day of work, employees should be informed of their sick pay & other pay information (paternity, maternity, bereavement, etc) and the notice period required.
This information can be included in the principle or can be given via a separate document, but it must be readily available for the employee to access.
An employment contract can outline both employee and employer rights & obligations – For example, you have the right to be paid the agreed wage for doing your job.
These contracts can be subject to change but usually requires both the employer and employee to agree to these changes (if an employee doesn’t agree initially, they can be offered incentives to accept the changes).
Employees must be informed of any changes to contract within a month of the changes being made.
Many employers now choose to document all of this information in one place, making it easy for both parties to access this information, this is often referred to as an employee handbook.
Employee handbooks are a quick and easy way to induct new employees and introduce them to the companies values & policies.
If there is a breach of the contract (the contract is broken) on the employee’s side, they may be subject to disciplinary procedures and may even lead to the termination of employment.
If the employer breaches the contract, employees can raise a grievance against their employers which could then lead to an employment tribunal claim – costing both time and money!
This is why having a well set out employment contract is so important, to avoid such issues.
What Are the Top 5 Must Haves to Include in your Employment Contract?
1, Relevant Job Information
It is important to include all the relevant information about the job in question; having the start date (and end date if applicable), job title & description, pay details (e.g. rate of pay and date of payday), hours of work, locations and the team/department included in your employment contract ensures that all new hires can prepare and eases the induction stage.
This should also include both employee and employer details, this makes it easier for both parties to get into contact with each other if necessary.
2, Company Policies and Procedures
Some companies choose to highlight the relevant policies and procedures to new hires using a separate document to the employment contract.
However, this can often lead to new employees losing or forgetting where the HR policy information can be accessed.
Including the important policies and procedures in the employment contract itself ensures that all employees can quickly and easily find details on the company’s policies.
There are only three policies that are required to be in place by UK law – These are the Health & Safety policy, grievance policy and disciplinary/dismissal policies.
Although there are many other policies you may want to include in your employment contract; for example, sickness & absences, holidays, bullying & harassment, equal opportunities, flexible working, alcohol/drug abuse and redundancies & retirement. You may want to add specificity to your contract to avoid future misunderstandings. For example, if your employee works with a company car or computer, you may want a policy on damaged company property.
3, Confidentiality Agreements
Having a confidentiality agreement in the employment contract can have many benefits, allowing employers to protect their business trade secrets and other vital information.
This ensures that past, present and future employees do not share or leak any information from the business.
Having a confidentiality agreement signed in the employment contract increases the protection a business has legally if an employee breaches the agreement – This often deters any information being leaked by employees.
4, Employment Assessment Details
Outlining how and when employees are assessed, including when the first assessment will be made, can greatly improve the stress felt by employees. Often having your work performance assessed can cause feelings of anxiety, fear and stress in employees.
Having all the information about employee assessments and reviews can seriously improve employee-employer relations and increase job satisfaction levels.
Constructive feedback and appraisal can improve employee morale and encourage them to hit and succeed in their employment goals.
For more information on performance management, click here!
5, Use of Technology
Today, the world is more connected than ever – Using technology and the internet is a great asset for businesses, allowing them to make connections which weren’t an option before the age of technology.
However, this can also cause a problem for employers, employees may abuse the use of technology and the internet – Using social media or playing mobile/PC games while at work can significantly reduce productivity and can often lead to mistakes being made (due to being distracted).
Having a technology policy or agreement with employees can help to set the boundaries of what is appropriate at work concerning the use of technology; plus, it shows that the company takes these matters seriously which can reduce the likelihood of employees abusing the technology in place at work.
Does your business need help with employment contracts or with HR in general? Wurkplace is here to provide personalised solutions! Call 0330 400 5490 or email info@wurkplace.co.uk.
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