What are employment contracts? What are the different types? If you are employed, you likely have one. In fact, it is something that dictates what your pay, working hours and conditions are. Additionally, there are certain written documents that your employer does and does not have to provide to you. Your Benefits will tell you everything you need to know about employment contracts.
What are employment contracts?
You may be employed. Then, you should have an employment contract with your employer. In fact, employment contracts dictate certain things about working conditions. This includes what someone needs to do, what they are responsible for, their rights, as well as the conditions of their job.
The conditions that the employment contract lay out are also known as “terms”. Additionally, until the end of the contract, both the employee and employer needs to stick to the terms of the contract until it finishes. Otherwise, until the terms of the contract end.
Two people may have a contract that dictates that someone provides a service or work at the other person’s house. Then, this likely is not an employment contract. Instead, it is a ‘contract to provide services’.
Types of employment contracts
There are different types of employment contracts. Some are not even considered as such. More specifically, there are 3 main types: employment contracts, contracts to provide services, and collective agreements.
A “contract to provide services” is similar to an employment contract. However, it dictates the terms for someone to provide a service or actions at someone else’s home. As such, it is not an employment contract.
A collective agreement is another type of employment contract. In fact, it is an employment contract negotiated with employers and the representatives of employees. More specifically, they will often be from staff associations or trade unions.
What are collective agreements in employment contracts?
As said above, collective agreements exist on top of employment contracts. They are negotiated between employers and representatives of the employees. They will most often be from staff associations and trade unions.
Often times, these negotiations will enable employees to receive better terms on things such as working hours and their wages. This is because this type of employment contract allows for collective bargaining. As such, employees have more power to negotiate for better terms.
There are several things that the terms of such an agreement will be able to contain. More specifically, they could have the following:
- What specific conditions and terms of the employment contract will be changed;
- What specific employees will be affected by the agreement that is agreed upon;
- The person that will be able to represent said employees;
- The way in which future negotiations will take place.
Note that when it comes to holidays, there is a certain statutory amount of pay and holiday that you are entitled to. More specifically, they are as follows:
| Holiday pay in the UK in 2022 for every type of work | |
|---|---|
| Type of work | How your weekly pay is counted |
| No fixed hours (this includes casual work, like zero-hours contracts) | Your average pay over 52 weeks (do not count weeks where you were not paid) |
| Shift work which has fixed hours (this includes both part-time and full-time) | The worker's average weekly fixed hours in the 52 weeks prior, and at the average hourly rate |
| Fixed pay and hours (this includes both part-time and full-time) | The typical pay that the worker receives weekly |
What are the terms of employment contracts?
The terms of an employment contract dictate what the conditions of your job (as an employee) are. If certain things in employment contracts are legally binding, your employer will need to clearly set this out. There are multiple things that an employment contract terms can be:
- Indicated in your employer’s employee handbook, or a notice board at the company;
- Setting out the terms verbally;
- Writing out the terms in a written contract, or any similar document (for example, this could be a written statement of employment);
- Laid out in an offer letter sent by the employer;
- Part of a collective agreement (this means that the employment contracts‘ terms would be determined by the employer and trade union staff, for example);
- Be implied but not written down, although they are part of the contract (‘this is known as implied terms‘);
- Terms can also be legal requirements, like having to pay your employees the National Minimum or Living Wage.
Implied terms can be a number of things. For example, it might include things that have been done in the company for a long time. In fact, this can include things such as paying employees a Christmas bonus. Additionally, it could be someone that is needed for the job. For example, being able to drive a car.
What are employment particulars?
Employment particulars are not employment contracts. However, what they do is set out the conditions about a worker’s working conditions. More specifically, the main conditions.
Employers must provide employment particulars to their employees and workers when they start work. This must be written in a document. It is also known as a “written statement of employment particulars“. Also note that this is different from employment contracts.
There are 2 main parts of employment particulars. Note that this needs to be in the form of a written document. They are as follows:
- The principal statement (which is the main written document);
- An additional written statement which gives more details (also known as the ‘wider written statement’).
Your employer needs to provide both documents within a certain time period after you start your job. More specifically, they need to give your principal statement on the same day that you start your job.
Then, your employer needs to give you your wider written statement. They do not need to provide it as soon as you start your job. However, they need to give it to you no later than 2 months after you starting your job.
What does the principal statement need to include?
There are many things a principle statement needs. At a minimum, it needs the name of the employer, the name of the worker or employee, and either the name or a description of the job that they would have. Then, the day on which they would begin employment.
It should also indicate when workers or employees would receive their wages. Additionally, it should show what hours and days they would work, as well as if this could change. Overtime hours, nights and Sundays need to be written in the statement, if they are expected conditions of the job.
If the employer’s address is different from where the employee or workers work, this will need to be indicated. Furthermore, the date on which employment would end, or how long the job is, needs to be indicated. For fixed-term employment contracts, the exact date is required.
The statement needs to show the length of the probation period. Additionally, it needs to indicate what the conditions of the probation period would be.
Lastly, any training that employees have to go through needs to be written. Additionally, the training may or may not be paid by the employer. This needs to be indicated as well.
Employment contracts: necessary information on first day
There are other information that needs to be given by your employer on your first day. In fact, they need to indicate necessary information about sick pay, and the steps that you would need to take in this situation.
You may not work in the UK, for a duration superior to one month. Then, there are additional information that your employer needs to indicate in your principal statement. More specifically, the following:
- What the conditions (or ‘terms’) have to be if the worker or employee has to come back to the United Kingdom;
- Any additional benefits or pay that the worker or employee abroad would be able to receive;
- The type of currency that would be paid to the worker or employee;
- The length of time that the employee would work in the UK for.
All of this information can be indicated in a document separate from the principal statement and employment contracts. However, if this is the case, the worker or employee has to have access to this document.
What does the wider written statement need to include?
This document needs to be provided no later than 2 months after the worker or employee starts their job. Additionally, there is some information that the wider written statement needs to indicate. This includes the following:
- Any procedures required if an employee want to raise a grievance;
- What a worker or employee’s rights are when it comes to non-compulsory training that the employer provides;
- Anything workers or employees need to know about collective agreements;
- Any information about pension schemes provided by the company.
Problems with employment contracts
You could have problems with your employment contracts, principal statement or wider written statement. In fact, it could be the case that your employer did not give your principal or wider written statement. Then, you have three recourses.
Then, the worker or employee could win the case on another problem. For example, this could be on an illegal wage decrease. Then, if (on top of that), the employer did not follow procedures with the written statements, the courts could award compensation to the worker or employee.
