When do you issue contracts of employment? Will this meet the new requirements?

Changes in employment law in April 2020 will require every employer to issue a ‘written statement of terms’ to employees and workers on (or before) their first day of work.

Currently the law allows two months for the written statement to be issued and currently the right does NOT extend to workers. This will all change in April.

What is the written statement?

The written statement of terms relates to specific information that is set out in section 1 of the Employment Rights Act 1996. Technically it may not be the ‘contract of employment’, but where a written contract is issued this information will normally be included in the contract. This information may also be included in an offer letter (but generally offer letters fail to include all the required information).

So, the written statement sets out the minimum written information that must be provided by law.

When must it be issued and to whom?

Currently the statement can be given up to two months from the start of employment and you are only required to issue information to employees.

From April 2020, it will become a ‘day 1’ right. This means it has to be issued either before or on the first day of employment. In addition, the right has been extended to workers, not just employees.

What information has to be provided?

The information required is listed in the Employment Rights Act 1996. In summary it includes:

  • The name of the parties (the company and the employee or workers name)
  • Job title
  • The date employment began
  • Pay rate and when payments are made
  • Hours of work
  • Holiday entitlement
  • Place of work
  • Sick pay arrangements
  • Notice periods
  • Information about disciplinary and grievance procedures (you can refer to other documents, but need to have a written disciplinary and grievance procedure)
  • Any collective agreements that effect employment terms or conditions
  • Pensions and pension schemes
  • If the employment is not permanent how long employment is expected to continue, or if you are a fixed term worker the date your employment will end

New requirement includes:

  • Details of other types of paid leave (e.g. maternity, paternity)
  • Duration and conditions of any probationary periods
  • Training requirements (mandatory and/or any training the employer will not bear the cost of).
  • Which specific days and times workers are required to work.

How can you manage this?

The easiest way to manage this new requirement (if you do not currently have procedures in place), is to have a clear process. This may include having your template documents available that you can then amend easily for each new employee.

BUT… just meeting the legal requirements will do little to protect your business.  It would be more beneficial to take this opportunity to have full contracts of employment for employees, and a more detailed statement for workers. This will afford you greater protection and flexibility.

Can you automate the process?

If you use YourHR.space, and your contracts have been drafted by Practical HR, we will be able to automate the process for you with new functionality being developed for this purpose. Once set up, you will simply have to assign the type of contract (or contract category) you want to issue to the employee (literally a click of a button), and the document will automatically be produced, populating the document from the employee database. The employee can then access this by logging in and sign it electronically.  A .pdf copy is then available from their area of the employee database.  

Fiona Haworth

You can contact Fiona on fiona@practical-hr.co.uk

If you feel that you need guidance or advice on this matter, please call Practical HR on 01702 216573 or email Fiona on the above.

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