Employment Contracts

1. The Basics

1.1 A job applicant has a contract of employment as soon as your offer of employment is accepted.

A contract exists, regardless of whether anything is in writing.

• The written statement (see 1.2) provides evidence of the contractual terms.
• The contract will also include other terms (see 1.3 to 1.5).
• The contract can be conditional upon an employee providing you with evidence of suitability, such as adequate references, passing a medical examination, or completion of a probationary period.
• If the written statement sets out terms which differ from those agreed when the offer was made, it could mean that if tested, the original terms will apply.This may be the case if the written docments have been signed and returned, and the signature was merely to acknowledge receipt.

1.2 You are legally obliged to provide every employee (full or part-time) with a written statement, covering a number of specified terms and conditions (see 2).

• You must issue the statement within the first two months of employment.
• An employee whose employment terminates within two months must be issued with the written statement before termination, unless the employment continued for less than one month.
• An employee may complain to an employment tribunal if you fail to issue the statement on time (or if the statement is incomplete).
• There is no penalty against an employer who fails to issue a statement unless the failure is established in the course of other proceedings before a tribunal.In such a case the tribunal may award two or four weeks pay.
• Dismissing or penalising an employee for complaining to an employment tribunal can lead to heavy penalties.

1.3 Other documents may provide evidence of contractual terms. For example:

• A job offer letter or job description (but see 4.1 and 4.2).
• Company handbooks and policy documents.

1.4 Custom and practice in your company may form part of the contract, even if it is not written down. The easiest way to protect yourself is to ensure that everything important is in writing.

• Make it clear what is not part of the contract (see 4).

1.5 There are legal constraints on the content of the contract (see 3).

• Some implied terms are included in every contract, even if they are not written down.
• Contracts cannot override certain statutory rights.

1.6 You cannot change the employment contract unilaterally.

• Consult employees and get their agreement before making fundamental changes to their terms and conditions.
• Altering terms and conditions without the employee's consent is a breach of contract. This could lead to a complaint of constructive dismissal (unless the change is one that is clearly advantageous to the employee, such as a pay rise).
• If you wish to change any of the particulars in the written statement, you must notify the employee in writing. This must be done within a month of the date when the change takes effect.