Myth busting employment contracts
Published: 24 Aug 2022
We’ve recently seen some businesses get caught out by the requirements surrounding employment/worker contracts.
So, here are five things employers should know:
- Minimum written terms: legally, employees and workers must receive a written statement of particulars of employment on or before their first day of employment/engagement. This document is often called a “section 1 statement”.
- Section 1 statement requirements: there is a prescribed list of terms (really, the fundamental terms of the employment relationship) which the document must include. In addition, it must be in writing and provided to the employee/worker on or before their first day. It isn’t a contract and it doesn’t need to be signed.
- You can provide an employment/worker contract instead: a section 1 statement satisfies the minimum legal obligations. It’s sufficient for some roles. However, most employers choose to provide a full contract (doing so has a number of benefits). Provided the contract meets the section 1 statement requirements it can be used instead of a section 1 statement.
- Some variations of terms must be in writing: any variation to a section 1 statement must be set out in a written statement (often called a “section 4 statement”) and provided within one month of the change taking effect.
- It’s best practice to record all terms in writing: regardless of any legal obligation, it’s normally sensible to have all contractual terms/variations in writing and signed by both parties. Where terms are only agreed verbally this makes it more likely for confusion to arise and more difficult to evidence what was agreed.
If an employer doesn’t provide a section 1 statement (or alternative) then an employee/worker may bring an Employment Tribunal claim. Recording contractual terms in writing provides certainty for both parties and can save you time and difficulties down the road.