Drafting a contract of employment – the devil’s often in the lack of detail

Account Partner(resize)

When taking on a new starter, it can be very easy to forget about sorting out their written contract of employment or you might find yourself simply using a basic document you’ve used in the past and which you don’t give much attention to.

However, this can simply be a hostage to fortune. It’s worth spending the time and effort putting together a detailed contract which covers not only things such as hours of work, duties and pay, but which also contains sections on things such as confidentiality and post-employment restrictions, as well as meeting the minimum statutory requirements.

Every employee is required by law to be given a minimum written statement of their terms and conditions of employment and this must contain details of the following:

  • the names of the employer and the employee
  • the date when the employment began
  • the date on which the employee’s period of continuous employment began (taking into account any employment with a previous employer which counts towards that period)
  • the rate of the employee’s remuneration or the method of calculating remuneration
  • the intervals at which the employee’s remuneration is paid
  • any terms and conditions relating to hours of work (including normal working hours)
  • any terms and conditions relating to:

–        holidays, including public holidays, and holiday pay

–        incapacity for work due to sickness or injury and sick pay

–        pensions and pension schemes

  • the length of notice which the employee has to give and is entitled to receive to terminate their contract of employment
  • job title or a brief description of the work for which the employee is employed
  • where the employment is not intended to be permanent, the period for which it is expected to continue or, if it is for a fixed term, the date when it is to end
  • either the employee’s place of work or, where the employee is required or permitted to work at various places, an indication of that and of the address of the employer
  • any collective agreements (with a trade union) which directly affect the terms and conditions of the employment
  • where the employee is required to work outside the United Kingdom for a period of more than one month:

–        the period for which they are to work outside the United Kingdom

–        the currency in which they are to be paid while they are working outside the United Kingdom

–        any additional remuneration payable to them, and any benefits to be provided to or in respect of them, by reason of being required to work outside the United Kingdom

–        any terms and conditions relating to their return to the United Kingdom

  • any disciplinary rules and disciplinary procedures applicable to the employee (or a reference to the provisions of another document specifying those rules and procedures and where that document is reasonably accessible to the employee)
  • details of how and to whom the employee can appeal against any disciplinary decision
  • details of how and to whom the employee can raise a grievance relating to their employment
  • details of whether a pensions contracting-out certificate is in force in respect of the employee’s employment.

However, it’s advisable also to think about other provisions which are often worth including. For example, you may want to include restrictions on the employee’s ability to deal with your clients or work for a competitor in each case for a period of time after they have left your employment, and if you do, then these restrictions need to be very carefully drafted, as otherwise they are likely to be unenforceable against the employee.

It’s also worth considering whether to include flexibility in the contract in relation to things such as duties and responsibilities and work location, so that if, for example, you relocate your business in future and so want to move the employee’s place of work, they will find it harder to say that the move amounts to a breach of their employment contract.

It’s also a good idea to have carefully drafted employment policies in place dealing with things such as equality and diversity, bullying and harassment, bribery and corruption, whistleblowing, social media and internet usage. Employees are less likely to engage in conduct which you do not want them to if it’s been made clear to them in a written policy what sort of conduct is and is not prohibited and what the consequences of breaching the policy could turn out to be. You also will be on stronger ground as an employer if you discipline or dismiss an employee for misconduct and you can point to a document which clearly prohibited that conduct and which you can also demonstrate that you drew to the attention of the employee.

For more information about any of the above or for practical commercial advice on this or any other aspect of employment law, please contact Nigel Crebbin of the Berg Employment Team on 0161 833 9211 or email him at nigelc@berg.co.uk. Follow Berg’s employment team at Twitter: #BergHR.

(The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or any of its partners or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.)

Nov 13, 2014