True or False?

Why do we have contracts of employment?

Employers are legally required to provide employees with a statement containing the main terms and conditions of the employment within two months of the employee’s start date. This has to contain information such as pay, holiday entitlement, working hours etc. which govern the working relationship.

But does the Employee have to sign this statement or a Contract of Employment for it to be valid?

The Law

This written statement is a legally binding agreement between the employer and employee which, like other types of contract, is capable of being formed through conduct alone as opposed to a signature.

This means that the contract can be formed when the employee agrees to work for an employer in return for pay, not necessarily when the employee signs the document.  Whilst the best evidence of a binding agreement is a contract signed by both parties, the terms can also be accepted if the parties have otherwise acted consistently with the contract.

There is of course an exception where the employee has made it clear that he/she objects to a particular clause.

Best practice

Whilst there is no statutory obligation upon the employer to have the Contract of Employment or written statement of particulars signed, employers can avoid potential arguments about the enforceability of a particular clause or term in a contract of employment by:

1. Sending out contracts of employment to new staff members as soon as they have accepted an unconditional job offer and ask them to return these to you duly signed before their first day of work.
2. Reminding new staff members on their first day of work that they need to return the signed contract.
3. Asking new staff members after a week of work whether they have any comments or object to any of the clauses and make a note of this. If they have any objections you will need to address these.
4. Bringing the contract along to any probation meetings and ensuring sign off before probation is passed.

Even with useful guides such as this, contracts can still be a minefield, not to mention taking up vast amounts of time to read in detail. At TBOS we can provide you with help and guidance in respect of your contracts.  For further information and to discuss particular circumstances you can call us on 0845 881 112.