What an Employer Should and Should Not Do When Creating Employment Contracts in England

Employment contracts are legally binding agreements which detail the relationship between you and your employees. They can be written or verbal and may be termed a contract of service. Your employment contracts will describe your workers’ responsibilities in their job role and their rights and entitlements as employees. Therefore, you must create your employment contracts carefully and ensure they are correct. After all, you may need to rely on your contracts in an employment dispute. Hence, this article will explain what you should and should not do as an employer when creating employment contracts in England.

Remember the Written Statement of Employment Particulars

A written statement of employment particulars is not your employee’s entire contract. It summarises the main terms and conditions of employment, which must all be within employment law, including:

• pay; and
• working hours.

If you do not provide your worker with their written statement of particulars, you could face an employment claim at an employment tribunal.

Think About the Different Types of Terms

Employment contracts consist of different terms. Hence, you must be aware of them and think about them when creating your employment contracts.

Employment contract terms can be:

• express terms, which are terms you have agreed with your employee, such  as their rate of pay;
• implied terms, which are obvious and, therefore, do not need to be in writing (although it is good practice for clarity to include them in writing);
• statutory terms, which are provisions in employment law that automatically apply to employment contracts; and 
• incorporated terms, which are terms in other documents such as the staff handbook which apply to the contract.

Consider if Collective Agreements Will Apply to Your Employment Contracts

Once you create your employment contracts, they will not necessarily remain the same throughout your staff’s employment. Hence, employment contracts can be subject to changes at your request and with your employees. Therefore, you need to consider whether you may or may not have a collective agreement with your employees’ representatives, such as their trade union or staff association. 

Collective agreements will apply to specific terms and conditions in the contract, such as working hours. Nevertheless, collective agreements will not cover all your employees. Hence, it is vital to consider collective agreements before creating individual employment contracts.

Do Not Omit the Essential Information Required in an Employment Contract

Employment contracts can contain a whole range of important information. However, there are some essential terms every employment contract will contain. You must know what these are so you do not fail to include them in your employment contracts. 

These essential terms include:

• vital job information, such as the job title of the role;
• your worker’s pay and benefits;
• holiday leave information;
• defining the employment type such as worker or employee;
• the employment period, which includes hours of work and if the employment is permanent or temporary;
• the privacy policy information; and 
• how you can terminate the contract.

Do Not Rush or Dismiss Including Restrictive Covenants

When creating employment contracts for your staff, you must consider if you require any restrictive covenants. A restrictive covenant is a term within the contract of employment that restricts your staff either during or after their employment with you. 

You must not dismiss the need for restrictive covenants as they can protect your business interests. However, you should not rush to include them, as you must draft them carefully to ensure they are legally binding. For example, they need to be:

• clear;
• precise; and
• have a timeframe on the restriction.

Key Takeaways

Your employment contracts are a key part of your employee’s role, so you must get them right and understand what to do and not do when creating them. For example, you should remember to provide employees with a written statement of particulars and understand the different types of terms an employment contract can contain. There are also things you should avoid when creating your employment contracts, such as forgetting to include the hours your employee works, their pay and benefits. 

If you need help understanding what you should and should not do when creating employment contracts in England, our experienced employment lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer questions and draft and review documents for a low monthly fee. Call us today on 0808 196 8584 or visit our membership page.

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