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Why it’s a good idea to have written Contracts of Employment

The moment an applicant unconditionally accepts your offer of a job, a contract of employment comes into existence. This is the case whether or not it is in writing. The terms of the contract do not need to be written.

An oral contract is equally as binding as a written one. The difficulty is proving its terms if there is a dispute.

Even if you do not issue a full written contract, you are under a legal duty to provide employees with a written statement of the main terms of employment particulars within 2 months of the start of their employment with you.

A written statement is not itself a contract but it can provide evidence of the terms of conditions of employment between you and the employee if there is a dispute later on.

It’s particularly important to have a written contract if you want to include special provisions relating to an individual post/e.g. the handling of money, wearing of a uniform, post-employment restriction on competition to prevent any confusion or disagreement in future.

Where an employee has not received a written statement of employment particulars he or she maybe able to claim compensation.

Can an employer sue an employee for breach of contract?

If an employee has already presented to a tribunal claim and this is still active an employer can make a counter-claim to an employment tribunal if the employer suffers loss through the employee’s failure to observe the terms of their contract of employment. An employer may make a counter-claim at any time up to 6 weeks after the employer receives a copy of the employee’s original application to the employment tribunal. This 6 week period for counter-claims cannot be extended.

Pensions Reform

As part of its strategy to encourage people to save for their retirement from October 2012 – starting with employers with more than 50 employees – businesses will be required to automatically enrol their workers into workplace pensions. The requirement is going to be phased in for smaller employers.

Government proposals for changes in Employment Law

One of the most significant changes to employment law comes into force from 6th April 2012 and that is the increase to the qualifying period for unfair dismissal claims to 2 years for employees whose employment begins on or after 6th April 2012. Note that the qualifying period does not apply to discrimination claims.

There is also an ongoing ‘fundamental review’ of the employment tribunal rules of procedure. This may lead to individuals being required to pay a fee for bringing a claim, the increasing use and increase in the levels of costs awards. The government is also currently consulting on its proposals to simplify dismissal procedures and is seeking views from employers as to whether they are too onerous or complex. Views are also sought on compensated no-fault dismissals for micro businesses with fewer than 10 employees.

Dr Jane Elgar (Specialist in Employment Law) is a Partner at Liddell + Company Solicitors.
Jane is based at our Billericay Office on 01277 636426.