ASSA Employment Contract
This factsheet provides a comprehensive overview of employment contracts, outlining their legal requirements and the essential terms that must be included. It details reforms effective from April 2020, distinguishing between employment contracts and statements of terms, and explains the implications of non-compliance. It also discusses what happens if a contract or statement is not provided or if parties disagree on terms.
The contract of employment
This factsheet is part of a suite of employment factsheets and a pro forma contract and statement of terms and conditions that are updated regularly. These are:
The contract of employment,
The standard statement of terms and conditions/Working time,
Age discrimination Dealing with sickness Managing performance,
Disciplinary, dismissal and grievance procedures Unlawful discrimination,
Redundancy Settlement offers Family-friendly rights, and
Employment status: workers.
Every relationship between an employer and an employee is governed by a contract of employment, which is an agreement setting out their mutual obligations. This contract may be in writing or it may be oral. Where parties are clearly in a relationship of employment, the contract will start on the first day of work. If there are no written terms, the parties’ obligations are implied by looking at how they conduct their relationship on a day-to-day basis. So, although there is no need for an employment contract to be set out in writing in order to be legally valid, it is both highly advisable and technically a legal requirement to do so. The one exception to this is an apprenticeship contract, which must be set out in writing in order to be valid. (This is as laid out in "S32 of the Apprenticeship, Skills, Children and Learning Act 2009")
- Why should I use a written contract or statement?
As well as being a legal requirement, employers should bear in mind that writing down the basis of your agreement is likely to avoid disagreements later on. It is also a good discipline as it makes the employer think about, and decide, what the terms of the arrangement are going to be. It is therefore highly recommended.
- What are the minimum requirements?
For contracts of employment that started before 6 April 2020, the relevant law is contained in "S1 of the Employment Rights Act 1996". This required employers to provide employees with a written statement of the main terms of the employment within two calendar months of starting work. This statement did not have to be provided to any employee who worked for less than one month.
The mandatory terms that had to be covered in this statement were:
the names of the parties;
the date that employment started;
if the employee was already employed, and the contract related to a new position, on what date continuous employment with the employer started;
a job title and/or brief description of the role;
hours of work;
scale or rate of remuneration;
intervals of payment;
hours;
overtime;
holidays;
sick pay;
grievance procedure*;
disciplinary procedure*;
pension*;
place of work;
notice of termination that the employer was required to give the employee, and
whether or not any collective agreement applied to the contract.
* These did not need to be laid out in full in the statement but could be in a separate document to which the statement refers.
- Reform of the law
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