Employment contracts

This leaflet tells you what an employment contract is, how it works and what rights you have in relation to your employment contract.

What is an employment contract?

An employment contract is simply an agreement between two parties. In the agreement the employer is asking the employee to provide work or services and in return the employee will be paid. However, you do not have to be an employee in order to have an employment contract. Contracts will also be provided if you are self employed (and work on your own account) or if you are a worker, for example with an agency, sent to work for that organisation.

What should the contract say?

Although an employment contract does not have to be in writing. However for an employee, the law requires that there should be a ‘statement‘ provided by the employer within two months of the start of the job in which certain basic information should be given to that employee. There are fifteen items which the employee must be given in written information about concerning their contract terms. These relate to matters such as names of the parties, date when the job began, hours and pay, holidays and notice period.

What happens if I don’t get anything in writing?

Because the law states that an employer must provide a ‘statement‘ within the first two months of starting their job which must contain this basic information, then an employee who has not received this statement can go to an employment tribunal and seek a declaration from the Tribunal as to what should be in their written statement.

What else can the contract say?

As well as providing the basic legal items, it is possible for an employment contract to contain a number of other matters that have been agreed between the parties. As long as they are not unlawful or meaningless then it is quite possible for an employee and an employer to agree to a whole range of terms in their employee’s contract. An example of this would be a clause which might require the employee working at more than one location in their job or to be required to keep their employer’s business affairs confidential.

What is a breach of contract?

Once the terms of an employee’s contract are agreed, then neither party should break these terms. If you have terms in your contract which your employer wishes to vary (alter), then this could be a breach. An example could be expecting you to accept less pay or to work longer hours than is set out in your contact.

Can I claim for it?

It is possible for employees to claim for some breaches. An employee can either prove that the breach was very substantial indeed, which means that they may resign and claim “constructive dismissal” for the fundamental or substantial breach. However, you should always seek advice before resigning from your job because it is often very difficult to show that this was justified and your employer should pay compensation for the loss of your job.

Other claims may relate to the failure to pay you wages or holiday pay or notice pay. These are also examples of a breach of contract.

Where do I take my claim?

Any employee who claims a breach of contract (such as a deduction in their wages) and remains in employment can begin a claim in the local small claims court.

However, if the job has ended and the employee has a breach of contract claim, they can pursue this claim in the employment tribunal. The advantage of this is that currently you do not have to pay a fee to begin a claim in an employment tribunal.

To find out more about employment tribunals, see www.employmenttribunals.gov.uk