Employment Contracts.

An employment contract is a legally binding agreement between an employer and an employee. It sets out the terms on which the employee works, including their duties, pay, working hours, workplace, benefits and responsibilities.

An employment contract does not always have to be contained in one signed document. It may consist of written terms, verbal agreements, workplace policies, collective agreements, statutory rights and terms implied by law or established through custom and practice.

A contract will usually come into existence when an unconditional offer of employment is accepted, even if the employee has not yet started work or signed a formal document.

This guide principally covers employment contracts in England, Wales and Scotland. Northern Ireland has a separate employment-law system.

Who Has an Employment Contract?

Every employee works under a contract of employment, whether or not the contract has been formally written down or signed.

Workers who do not have full employee status will also have a contract governing the work they perform, although it may not be a contract of employment.

The legal status of the individual affects the rights and obligations arising from the relationship.

Employees

An employee works under a contract of employment, sometimes described as a contract of service.

Employees generally receive the widest range of statutory employment rights, which may include:

• the National Minimum Wage or National Living Wage;
• paid annual leave;
• rest breaks and working-time protection;
• statutory sick pay where eligible;
• family-related leave and pay;
• protection against unlawful discrimination;
• statutory notice;
• redundancy rights where the qualifying conditions are met; and
• protection against unfair dismissal where the applicable eligibility requirements are satisfied.

Workers

A worker may perform work personally without having the full legal status of an employee.

Workers generally have important statutory rights, including:

• minimum wage protection;
• paid annual leave;
• working-time rights;
• protection against unlawful deductions from wages;
• protection against discrimination; and
• whistleblowing protection in qualifying circumstances.

They do not necessarily receive all the rights available to employees.

Self-Employed People

A genuinely self-employed person normally works under a contract for services rather than a contract of employment.

For example, a householder engaging an independent tradesperson to repair a boiler would usually enter into a contract for services.

The description used in the written agreement is not conclusive. A person described as self-employed may legally be a worker or employee if that reflects the reality of the relationship.

Employment Status

Employment status is determined by examining the complete working arrangement rather than relying only on the title of the contract.

Relevant factors may include:

• whether the person must perform the work personally;
• whether they can send a genuine substitute;
• the degree of control exercised by the organisation;
• whether the organisation must offer work;
• whether the individual must accept work;
• who provides tools and equipment;
• whether the individual bears financial risk;
• whether they are integrated into the organisation;
• whether they work for other clients;
• how they are paid; and
• the parties’ actual conduct.

Employment status can differ for employment-law and tax purposes. HM Revenue and Customs may reach a different conclusion from an employment tribunal because the relevant legal tests are not identical.

When Is an Employment Contract Formed?

An employment contract will generally be formed when:

• the employer makes a sufficiently clear offer;
• the applicant accepts the offer;
• each party provides something of value, usually work in return for pay; and
• the parties intend the agreement to create legal obligations.

An offer may be verbal or written.

A conditional offer may depend on matters such as:

• satisfactory references;
• evidence of qualifications;
• a right-to-work check;
• a criminal-record check where lawful and relevant;
• medical clearance where lawful;
• regulatory approval; or
• another stated pre-employment condition.

If an unconditional offer has been accepted, withdrawing it may amount to a breach of contract even where the employee has not yet started work.

Written and Verbal Employment Contracts

An employment contract may be:

• contained in a signed written agreement;
• agreed verbally;
• set out in an offer letter;
• recorded in emails or correspondence;
• incorporated from a staff handbook;
• affected by a collective agreement;
• implied by law; or
• established through custom and practice.

A verbal employment contract can be legally binding. However, disputes are more likely where important terms have not been recorded clearly.

Employers should provide comprehensive written terms and identify which policies form part of the contract.

The Written Statement of Employment Particulars

Employees and workers are legally entitled to receive a written statement setting out specified particulars of their employment.

This statement is sometimes referred to as the employment contract, but legally it is only a summary of the principal terms. The complete contract may include additional written, verbal, implied and statutory terms.

When Must the Written Statement Be Provided?

The principal statement must be provided on or before the employee or worker’s first day of work.

The right applies regardless of whether the work is expected to last for more than one month. The previous rule allowing employers to wait until an employee had completed a month is no longer current.

Some additional information may be supplied separately, but must generally be provided no later than two months after employment begins.

Who Is Entitled to a Written Statement?

The right generally applies to:

• employees;
• workers;
• casual workers;
• zero-hours workers;
• agency workers in appropriate circumstances;
• fixed-term employees; and
• part-time employees.

The precise identity of the organisation responsible for providing the statement may require consideration in agency and outsourcing arrangements.

What Must the Principal Statement Include?

The principal statement must include the main terms of the working arrangement.

These ordinarily include:

• the employer’s name;
• the employee or worker’s name;
• the employer’s address;
• the employment start date;
• the date continuous employment began for an employee;
• the job title or a brief description of the work;
• the rate of pay or method of calculating pay;
• how often and when the person will be paid;
• normal working hours;
• the days of the week the person is required to work;
• whether and how working hours or days may vary;
• the place or places of work;
• the holiday entitlement and holiday pay arrangements;
• notice periods;
• the duration of a temporary or fixed-term appointment;
• any probationary period and its conditions;
• contractual benefits;
• non-contractual benefits;
• sick leave and sick pay information;
• other forms of paid leave;
• mandatory training;
• whether the employer pays for mandatory training; and
• terms applying where the person is required to work outside the United Kingdom.

Information That Can Be Provided Separately

Certain information can be included in another reasonably accessible document or supplied within two months of the start date.

This may include:

• pension arrangements;
• collective agreements affecting employment;
• non-compulsory training provided by the employer;
• disciplinary rules;
• disciplinary procedures; and
• grievance procedures.

The principal statement should clearly identify where this information can be found.

Working Outside the United Kingdom

Where an employee or worker is required to work outside the United Kingdom for more than one month, the written statement must provide additional information.

This will normally include:

• the country in which they will work;
• the expected duration of the assignment;
• the currency in which they will be paid;
• additional pay or benefits associated with the assignment;
• arrangements for returning to the United Kingdom; and
• information required by applicable overseas-posting rules.

International assignments may also raise issues concerning tax, social security, immigration, local employment rights, pensions and governing law.

Express Terms

Express terms are provisions specifically agreed between the employer and employee or worker.

They may be recorded in:

• the employment contract;
• the written statement;
• an offer letter;
• emails;
• a bonus or commission plan;
• a staff handbook;
• a collective agreement; or
• a verbal agreement.

Common express terms concern:

• pay;
• hours of work;
• duties;
• holiday;
• work location;
• benefits;
• notice;
• probation;
• confidentiality;
• intellectual property;
• restrictive covenants; and
• disciplinary arrangements.

Implied Terms

Implied terms form part of the contract even though they have not been expressly written or agreed in detail.

A term may be implied:

• by legislation;
• by common law;
• because it is necessary to make the contract workable;
• through custom and practice;
• because it is obvious that both parties intended it; or
• because of a relationship of trust and confidence.

Employee Duties Implied by Law

An employee will generally be expected to:

• perform the work with reasonable care and skill;
• obey lawful and reasonable instructions;
• act honestly;
• protect confidential information;
• avoid deliberately competing with the employer while employed;
• account for the employer’s money and property;
• cooperate with reasonable working arrangements; and
• avoid conduct that seriously damages the employment relationship.

An employee asked to drive as part of their role may be expected to hold an appropriate licence and comply with road traffic law. The precise responsibility should still be stated clearly where driving is an important part of the job.

Employer Duties Implied by Law

An employer will generally be expected to:

• pay the agreed wages;
• provide a reasonably safe working environment;
• take reasonable care of the employee’s health and safety;
• deal with the employee in a manner consistent with mutual trust and confidence;
• provide work in circumstances where the contract requires it;
• reimburse authorised expenses where appropriate;
• act fairly when exercising contractual discretion; and
• comply with statutory employment rights.

Mutual Trust and Confidence

Employment contracts generally contain an implied duty that neither party will, without reasonable and proper cause, behave in a manner calculated or likely to destroy or seriously damage the relationship of mutual trust and confidence.

Possible employer breaches may include:

• serious bullying or humiliation;
• making unfounded allegations;
• dishonestly withholding pay;
• failing to investigate serious grievances;
• deliberately undermining the employee;
• acting in bad faith; or
• imposing a serious contractual change without lawful authority.

A sufficiently serious employer breach may allow an employee to resign and consider a constructive dismissal claim, although strict legal tests and time limits apply.

Statutory Terms and Minimum Rights

Employment contracts operate alongside statutory employment law.

An employer cannot normally use a contract to give an employee or worker less than the applicable statutory minimum.

Statutory rights may include:

• minimum wage entitlement;
• paid annual leave;
• rest breaks;
• maximum average weekly working time, subject to exceptions and opt-outs;
• family-related leave;
• statutory sick pay where eligible;
• statutory notice;
• protection from unlawful deductions;
• protection against discrimination;
• whistleblowing protection; and
• workplace pension rights.

A contractual term providing less than the statutory minimum may be unenforceable to that extent. A contract can provide more generous rights.

Holiday Entitlement

Most workers are entitled to at least 5.6 weeks of paid annual leave in each leave year.

For somebody working five days a week, this normally amounts to 28 days. The 28 days may include bank holidays.

Holiday entitlement for part-time, irregular-hours and part-year workers is calculated according to the applicable working-time rules.

The employment contract or holiday policy should explain:

• the holiday year;
• the employee’s entitlement;
• whether bank holidays are included;
• how holiday must be requested;
• whether leave can be carried forward;
• the treatment of holiday during sickness or family leave;
• whether the employer can require leave to be taken; and
• how accrued holiday will be dealt with when employment ends.

Pay and Deductions

The contract should state the employee’s salary or wage, the pay period and the method of payment.

It should also address, where relevant:

• overtime;
• commission;
• bonuses;
• shift allowances;
• expenses;
• tips or service charges;
• salary reviews;
• benefits in kind; and
• authorised deductions.

An employer cannot normally deduct money from wages unless:

• the deduction is required or permitted by legislation;
• the contract authorises it; or
• the worker gave prior written consent.

Special rules apply to deductions for cash shortages and stock deficiencies in retail employment.

Bonuses and Commission

A bonus may be:

• contractual;
• discretionary;
• partly discretionary;
• based on personal performance;
• based on company performance; or
• governed by a separate scheme.

Describing a bonus as discretionary does not necessarily allow an employer to act irrationally, dishonestly, discriminatorily or in bad faith.

The contract or bonus scheme should explain:

• how entitlement is calculated;
• when payment is made;
• whether the employee must remain employed on the payment date;
• the treatment of notice and garden leave;
• whether targets can be changed;
• whether commission is earned on orders, invoices or payment; and
• what happens when employment ends.

Working Hours

The written statement should identify normal working hours, working days and whether those hours or days may change.

The contract may also address:

• overtime requirements;
• shift patterns;
• weekend and bank holiday work;
• night work;
• on-call arrangements;
• travel time;
• remote working;
• flexitime;
• breaks; and
• time recording.

Working arrangements must comply with the Working Time Regulations and equality law, subject to any applicable exceptions.

Place of Work and Mobility Clauses

The contract should identify the employee’s normal place of work and whether they may be required to work elsewhere.

A mobility clause may allow the employer to change the workplace or require relocation.

Such a clause does not necessarily give the employer an unlimited right to move the employee. The employer should exercise it reasonably and consider:

• the distance involved;
• travel time and cost;
• family and caring responsibilities;
• disability and reasonable adjustments;
• notice of the proposed move;
• the business reason; and
• whether relocation expenses will be paid.

An unreasonable relocation may amount to a breach of contract or give rise to redundancy issues.

Remote and Hybrid Working

Where an employee works remotely or under a hybrid arrangement, the contract or policy should address:

• the normal contractual workplace;
• required attendance at the employer’s premises;
• working hours and availability;
• equipment and maintenance;
• expenses;
• confidentiality;
• data protection and cybersecurity;
• health and safety;
• insurance;
• working overseas;
• monitoring; and
• the circumstances in which the arrangement can be reviewed.

A temporary remote-working arrangement does not necessarily create a permanent contractual right, but long-standing arrangements may become relevant through agreement or custom and practice.

Probationary Periods

A probationary period allows the employer to assess suitability for the role.

The written statement should specify:

• the length of probation;
• the standards expected;
• review arrangements;
• whether probation can be extended;
• notice during probation;
• benefits affected by probation; and
• what happens if no formal confirmation is issued.

Probation does not remove statutory rights. Employees remain protected against discrimination, unlawful deductions, whistleblowing detriment and other prohibited conduct during probation.

An employer should still follow a reasonable and contractually compliant procedure when dismissing or extending probation.

Temporary and Fixed-Term Contracts

A temporary contract is intended to last for a limited period or until a specified task or event has been completed.

A fixed-term contract may end:

• on a specified date;
• when a project is completed;
• when funding ends;
• when another employee returns; or
• when another stated event occurs.

The expiry of a fixed-term contract is generally treated as a dismissal for employment-law purposes.

Fixed-term employees have statutory protection against less favourable treatment compared with comparable permanent employees unless the treatment can be objectively justified.

Successive fixed-term contracts may, in some circumstances, result in the employee becoming permanent after the relevant statutory period unless continued fixed-term status is objectively justified.

Zero-Hours and Casual Contracts

A zero-hours contract does not guarantee a minimum number of hours.

The individual’s rights depend on whether they are legally an employee or worker and on the reality of the arrangement.

The contract should explain:

• whether work is guaranteed;
• whether the individual must accept offered work;
• how shifts are offered and cancelled;
• how holiday is calculated;
• the rate of pay;
• employment status;
• whether continuity of employment applies; and
• the procedure for ending the arrangement.

Terms preventing certain low-paid or zero-hours workers from working for another organisation may be unenforceable under statutory exclusivity protections.

Part-Time Employment

Part-time workers should not be treated less favourably than comparable full-time workers merely because they work part time, unless the treatment can be objectively justified.

Pay, holiday and benefits may be calculated on a proportionate basis where appropriate.

Collective Agreements

A collective agreement is negotiated between an employer and a recognised trade union or employee representatives.

It may address:

• pay and grading;
• working hours;
• overtime;
• holiday;
• redundancy arrangements;
• disciplinary procedures;
• consultation;
• training;
• health and safety; and
• other workplace conditions.

A collective term becomes part of an individual employee’s contract where it is incorporated expressly or by implication.

The written statement should identify any collective agreement that directly affects the employee’s terms and explain where it can be inspected.

Staff Handbooks and Workplace Policies

A staff handbook may contain policies concerning:

• sickness absence;
• disciplinary action;
• grievances;
• equal opportunities;
• harassment;
• expenses;
• IT and communications;
• social media;
• data protection;
• remote working;
• family leave;
• performance management; and
• health and safety.

The employer should state whether each policy is contractual or non-contractual.

A contractual policy may bind the employer and employee. A non-contractual policy may generally be amended more easily, although changes must still be lawful, reasonable and non-discriminatory.

Custom and Practice

A workplace practice may become an implied contractual term where it is:

• clear;
• certain;
• consistently applied;
• followed over a sufficiently long period;
• generally understood to be an entitlement; and
• not inconsistent with an express contractual term.

Examples might include a regular bonus, enhanced holiday arrangements or a long-established early finishing time.

A practice will not necessarily become contractual merely because the employer has followed it on several occasions. The circumstances and the parties’ understanding are important.

Changing an Employment Contract

An employment contract cannot normally be changed unilaterally unless the existing contract clearly permits the particular change and the employer exercises that power lawfully and reasonably.

Changes are commonly made by agreement between the employer and employee.

Possible changes include:

• pay reductions or increases;
• new working hours;
• changes to duties;
• relocation;
• removal or alteration of benefits;
• changes to commission or bonuses;
• new shift patterns;
• remote-working changes; and
• changes arising from restructuring.

Consultation and Agreement

An employer proposing a change should explain:

• what is changing;
• why the change is needed;
• when it would take effect;
• how employees will be affected;
• whether alternatives have been considered; and
• what support or compensation may be offered.

Meaningful consultation can help the parties reach agreement and identify unintended consequences.

Putting Changes in Writing

Where a required written particular changes, the employer must normally provide written confirmation within one month of the change.

Changes should be recorded even where they were agreed verbally, so that the parties have a clear account of the new terms.

Flexibility Clauses

A flexibility or variation clause may permit limited changes to specified terms.

Courts and tribunals generally interpret broad flexibility clauses cautiously. A general statement allowing the employer to make any change may not authorise a substantial reduction in pay, status or benefits.

The employer must still exercise the clause reasonably and consistently with mutual trust and confidence.

What Happens if an Employee Does Not Agree?

An employee faced with an unwanted contractual change may:

• agree to it;
• negotiate an alternative;
• work under protest;
• raise a grievance;
• refuse to work under the changed terms;
• bring a claim for unlawful deductions or breach of contract;
• resign and consider constructive dismissal; or
• face dismissal and an offer of re-engagement on new terms.

The appropriate response depends on the seriousness of the change, the wording of the contract and the employee’s legal status and service.

Continuing to work without objecting may eventually be treated as acceptance. An employee who objects should normally make their position clear in writing and seek advice promptly.

Dismissal and Re-engagement

An employer unable to obtain agreement may consider terminating the existing contracts and offering re-engagement on new terms. This is sometimes described as dismissal and re-engagement or fire and rehire.

This approach carries substantial legal and employee-relations risks.

The employer may need to consider:

• whether there is a substantial business reason;
• whether meaningful consultation has taken place;
• contractual and statutory notice;
• unfair dismissal risk;
• discrimination;
• collective consultation obligations;
• protective awards;
• trade union consultation;
• the statutory code governing dismissal and re-engagement; and
• reputational and workforce consequences.

Dismissal and re-engagement should not be treated as a routine method of changing contracts.

Notice Periods

The employment contract should state the notice each party must provide to end the employment.

Contractual notice cannot normally give an employee less than their statutory minimum entitlement.

Employees are generally entitled to at least:

• one week’s notice after one month’s continuous employment;
• one week for each complete year of service between two and twelve years; and
• twelve weeks after twelve or more years of service.

Longer contractual notice may apply.

An employee who has worked for at least one month must normally give at least one week’s notice when resigning unless the contract requires more.

Payment in Lieu of Notice

A payment in lieu of notice clause may allow the employer to terminate employment immediately and pay the employee instead of requiring them to work the notice period.

The clause should state what the payment includes, such as:

• basic salary;
• contractual benefits;
• bonus or commission;
• pension contributions; and
• holiday accruing during notice.

Where there is no contractual right to make a payment in lieu, immediate termination may technically amount to a breach of contract even where compensation is paid.

Garden Leave

A garden leave clause may allow the employer to require an employee not to attend work during all or part of the notice period while continuing to receive pay and contractual benefits.

During garden leave, the employee remains employed and must generally comply with duties of confidentiality, fidelity and any lawful contractual restrictions.

Summary Dismissal

Summary dismissal means dismissal without notice or payment in lieu.

It may be lawful where the employee has committed a fundamental breach amounting to gross misconduct.

Possible examples include:

• serious dishonesty;
• theft or fraud;
• serious violence;
• gross insubordination;
• serious misuse of confidential information;
• serious health and safety breaches; or
• another act fundamentally destroying the employment relationship.

The employer should normally investigate and follow a fair disciplinary process before deciding that gross misconduct occurred.

Confidentiality

Employees owe implied duties concerning confidential information during employment.

A written confidentiality clause can define and strengthen protection concerning:

• customer information;
• pricing;
• business plans;
• trade secrets;
• technical information;
• source code;
• financial information;
• personal data;
• supplier terms; and
• other commercially sensitive material.

A confidentiality clause cannot lawfully prevent protected whistleblowing, reporting criminal conduct, cooperating with regulators or making disclosures required by law.

Intellectual Property

Employment contracts commonly address ownership of intellectual property created during employment.

This may include:

• copyright;
• software;
• designs;
• inventions;
• databases;
• trade marks;
• documents;
• research; and
• other creative or technical work.

Legislation may give the employer ownership of some intellectual property created by an employee in the course of employment. Clear contractual wording can reduce disputes about work created outside normal hours or using the employee’s own resources.

Restrictive Covenants

Restrictive covenants seek to control specified activities after employment ends.

They may include restrictions concerning:

• working for a competitor;
• setting up a competing business;
• soliciting clients;
• dealing with clients;
• poaching employees;
• interfering with suppliers; and
• using confidential information.

A post-termination restriction is enforceable only where the employer has a legitimate business interest to protect and the restriction goes no further than reasonably necessary.

The court will consider matters such as:

• the employee’s role and seniority;
• access to confidential information;
• relationships with customers;
• the geographical area;
• the duration;
• the activities restricted; and
• the circumstances when the covenant was agreed.

An excessively broad covenant may be unenforceable.

Disciplinary and Grievance Procedures

The written statement must identify the disciplinary and grievance arrangements or state where they can be found.

A disciplinary procedure should normally explain:

• the standards expected;
• examples of misconduct and gross misconduct;
• the investigation process;
• possible warnings and sanctions;
• the right to be accompanied;
• the decision-making process; and
• the right of appeal.

A grievance procedure should explain how an employee can raise concerns about work, colleagues, managers, contractual terms or treatment.

Employers and employees should take account of the Acas Code of Practice on disciplinary and grievance procedures. Unreasonable failure to follow the Code can affect compensation in a relevant tribunal claim.

Sickness Absence

The contract or sickness policy should explain:

• how absence must be reported;
• who the employee must contact;
• when medical evidence is required;
• statutory sick pay;
• any contractual sick pay;
• attendance reviews;
• medical examinations;
• return-to-work procedures;
• long-term absence management; and
• the effect of disability and reasonable adjustments.

Employers must avoid discrimination and should consider reasonable adjustments where absence or attendance issues relate to disability.

Pensions and Benefits

The written particulars should identify pension arrangements or explain where details can be found.

Employers may have duties to automatically enrol eligible workers into a qualifying workplace pension and make minimum contributions.

Other benefits may include:

• private medical insurance;
• life assurance;
• company vehicles;
• income protection;
• share schemes;
• allowances;
• staff discounts; and
• enhanced family or sick pay.

The contract should distinguish between contractual benefits and discretionary benefits that may be amended or withdrawn.

Policies on Monitoring and Data Protection

Employers may monitor workplace communications or activity where there is a lawful and proportionate reason.

The contract or policies may address:

• email and internet use;
• telephone recording;
• CCTV;
• vehicle tracking;
• location data;
• productivity monitoring;
• biometric systems;
• artificial intelligence tools;
• personal device use; and
• remote-working monitoring.

Monitoring must comply with data protection, privacy and employment law. Employees should normally receive clear information about the monitoring being carried out.

If the Employer Does Not Provide a Written Statement

An employee or worker can raise the issue with the employer and request the required written particulars.

If the matter is not resolved, they may apply to an employment tribunal for a determination of the particulars that should have been provided.

Where the individual succeeds in another qualifying employment tribunal claim, the tribunal may also award additional compensation for the employer’s failure to provide an accurate and complete statement.

The written-statement claim is not normally a substitute for proving another complaint such as unpaid wages, discrimination or unfair dismissal.

Breach of Contract

A breach occurs where either party fails to comply with a contractual obligation.

Employer breaches may include:

• failing to pay salary or commission;
• withdrawing contractual benefits;
• changing hours without authority;
• failing to provide contractual notice;
• wrongly demoting an employee;
• failing to follow a contractual procedure; or
• breaching confidentiality.

Employee breaches may include:

• leaving without giving notice;
• disclosing confidential information;
• refusing lawful and reasonable instructions;
• misusing company property;
• breaching restrictive covenants; or
• failing to repay sums validly due under the contract.

Claims in the Employment Tribunal or Civil Courts

Some breach-of-contract disputes can be brought in the employment tribunal, while others must be pursued in the county court or High Court.

An employee can generally bring a contractual claim in the employment tribunal only where employment has ended and the claim falls within the tribunal’s statutory jurisdiction.

Tribunal contractual awards are subject to a financial limit. Higher-value or continuing-employment claims may need to be brought in the civil courts.

Claims concerning unlawful deductions from wages, discrimination or statutory employment rights may be brought under separate tribunal jurisdictions.

Time Limits

Employment tribunal time limits are usually short.

Many claims must be started within three months less one day of the relevant act, dismissal or deduction, subject to the applicable legislation and the effect of Acas Early Conciliation.

Civil breach-of-contract claims are commonly subject to a six-year limitation period where the contract was not executed as a deed.

The correct deadline should be calculated for the particular claim. Internal grievances or negotiations do not necessarily stop time running.

Acas Early Conciliation

Before bringing most employment tribunal claims, the prospective claimant must notify Acas and consider Early Conciliation.

Acas may help the parties explore a settlement without a tribunal hearing.

The Early Conciliation process can affect the tribunal deadline, but the calculation can be complex. Legal advice should be obtained promptly rather than waiting for an internal procedure to finish.

Drafting Employment Contracts for Employers

A properly drafted contract can reduce uncertainty and support consistent management.

The contract should reflect:

• the employee’s actual role;
• the business’s working arrangements;
• current employment legislation;
• the employer’s policies;
• the seniority of the employee;
• access to confidential information;
• bonus and commission arrangements;
• intellectual property;
• remote or hybrid working;
• post-termination risks; and
• any collective agreements.

A generic template may omit important terms or contain provisions that do not reflect the organisation’s practices.

Employers should review contracts periodically and whenever legislation, working arrangements or benefits change.

Reviewing an Employment Contract Before Signing

An employee should check:

• the employer’s legal identity;
• the job title and duties;
• salary and pay dates;
• bonus and commission terms;
• hours and overtime;
• the workplace and mobility requirements;
• holiday entitlement;
• probation;
• sick pay;
• benefits and pension;
• notice periods;
• intellectual property clauses;
• confidentiality;
• repayment clauses;
• garden leave;
• restrictive covenants; and
• the employer’s right to make changes.

Terms should be clarified before acceptance where they are unclear or do not reflect what was discussed during recruitment.

How an Employment Solicitor Can Help

An employment solicitor may assist employees and employers with:

• drafting employment contracts;
• reviewing contracts before signature;
• written statements of particulars;
• employment-status disputes;
• bonus and commission schemes;
• changing contractual terms;
• flexible and hybrid working arrangements;
• fixed-term and zero-hours contracts;
• collective agreements;
• confidentiality and intellectual property;
• restrictive covenants;
• disciplinary and grievance procedures;
• unpaid wages and deductions;
• constructive dismissal;
• dismissal and re-engagement;
• notice and termination payments;
• settlement agreements;
• employment tribunal proceedings; and
• civil breach-of-contract claims.

Finding an Employment Contract Solicitor

Employment contracts determine important matters such as pay, working hours, duties, benefits, flexibility and the process for ending employment. Clear terms can prevent disputes, while unclear or outdated contracts can create financial and legal risk for both parties.

Use the search facility at the top of this page to find an employment solicitor who can prepare, review or advise on an employment contract and any related workplace dispute.

This guide provides general information about employment contracts in Great Britain. It does not constitute legal advice and should not be relied upon as a substitute for advice about a particular employment relationship or contractual dispute.