Employment Contract Advice

On average it can take us 3-4 hours to draft a contract of employment which is tailored to the needs of your business. However, this depends on whether we are updating your existing contract or providing our own template contract. It also depends upon how many benefits you offer and the specific terms you want to be included for your business.

The starting point when drafting a contract of employment should always be the list of specific requirements in section 1 Employment Rights Act 1996. However, this is a basic list and many businesses need a contract which goes far beyond it.

A business should think about the practical arrangements for the role, the pay and benefits being offered, the work the employee does and any risks the business wants to protect itself against. Businesses should consider whether restrictive covenants and intellectual property clauses are relevant to the work being carried out.

Businesses should also consider the different categories of roles and whether different contracts should be used to reflect the seniority of the roles, the nature of the role and the tasks those categories of employee do. For example, a factory worker on the shop floor may need clauses relating to shift work, lay off and short time working; whereas for someone in the office working from home for part of the week these clauses may not be relevant but they may need hybrid working clauses instead.

Yes, an employment contract can be verbal. However, it can often be difficult to prove what was agreed verbally and there is more scope for one of the parties to challenge what was said. Verbal agreements can certainly be contractual and employers need to be careful that line managers don’t inadvertently make contractual offers which become binding.

It is also possible for clauses to be implied into a contract through custom and practice, incorporated through a staff handbook or a collective agreement, included through negotiation with the unions or added as a result of a piece of legislation.

Although an employment contract doesn’t have to be in writing, employees and workers do have a right under s.1 Employment Rights 1996 to be given certain information in writing from day one of their employment. This is known as a “written statement of employment particulars”. It is not an employment contract but most employers do use it as the base for their employment contract as it covers the key terms you would want to include in an employment contract.

A non compete clause prevents an individual from working somewhere else for a period of time after they leave their employment. They are a type of restrictive covenant.

Pure non-compete clauses have been controversial for several years. They can stop a person from working and earning a living. Depending on the industry, they could also prevent them from using skills which need to be regularly exercised to stay up to date and relevant.

Non-compete clauses are often included in a contract of employment along with the other restrictions as a standard clause. However, commercially employers often accept that if pushed they may not be enforceable. They are often included as a deterrent with employers not actually intending on enforcing them if breached, but instead hoping employees will abide by them due to the fear of any repercussions if they did breach them.

Although a specific clause all on its own, often the term “non-compete clause” is also used to refer collectively to all types of restrictive covenants. For example, non-solicit, non-deal, non-poach and non-compete clauses.

It is not normally possible to backdate an employment contract. It can only be done if there is a legitimate reason for doing so. For example, it is possible if the parties are simply recording in writing an agreement which had already been agreed.

Whilst there is no specific time frame within which an employee should receive a contract of employment, an employee or worker should be given a s.1 written statement of employment particulars before they start work. As most businesses use the s.1 written statement of employment particulars as the base for their employment contract, the same time frame should be used.

The contract should therefore either be given to the employee or worker before their first day or when they arrive at the workplace on their first day. It is generally seen as best practice to send the document to the employee or worker in advance and ask them to bring a signed copy with them on their first day.