Essential Elements Every Employment Contract Needs to Include

Introduction

It's been a while since we've uploaded any blogs here so we're kicking off with the basics for all UK based employers - what to include in your employment contracts.

Why Employment Contracts Matter

Employment contracts (also called a Written Statement of Particulars for workers and contractors) are legally required and should be issued to the employee on or before their first day of work.

The contracts are important, not just because it's a legal requirement, but also because they establish the basis for the relationship between you and your employee, covering how things will work while they are employed by you.

Contracts help to ensure that both parties understand their rights and responsibilities in the event that there is a dispute.

Key Elements of Employment Contracts

There's no requirement for the contracts to be arranged in any particular order.

1. The employee and the employer name

   
   

2. The start date of employment/ the contract

   
   

3. The date the employee's continuous service started.

   1. This is their original start date prior to any job or company changes. This could be different to the start date of the contract. E.g. Chloe started working for the business on 01/03/2023 which is her continuous service date, but a new contract may be issued on 01/10/2025.

      
      

4. Duration of Employment

   1. If the position is for a fixed term or temporary period, you need to include the expected duration of the contract.

      
      

5. Job Title

   1. Specify the employee's role and primary responsibilities.

   2. Clarify the reporting structure and who the employee will report to.

      
      

6. Probationary Periods

   1. Include whether probationary periods apply, for how long and what will happen during probation.

      
      

7. Salary and benefits

   1. Outline the salary structure - is their pay to be calculated hourly, monthly or annual?

   2. Outline how often they will be paid, which day of each week/month and by what method e.g. cash/bank transfer.

   3. Include additional benefits such as bonuses, health insurance, retirement plans etc.

   4. Include information about pension schemes.

      
      

8. Working hours

   1. Define the standard working hours and what happens if overtime is required, including rates of pay for overtime.

   2. Include policies regarding breaks (duration and paid/unpaid) and any flexible working arrangements.

   3. You should also include details of the days of the week the employee is required to work and whether the days or hours will vary.

      
      

9. Place of Work

   1. You should include the employer's address or the site at which the employee will normally be required to work.

      
      

10. Holiday Entitlement

    1. Detail the annual leave entitlement, what happens on public holidays and explain the process for requesting and taking leave.

       
       

11. Training Entitlements

    1. You need to include details of what levels of training will be provided to the employee and whether you will cover the cost of the training.

       
       

12. Sick Pay & Absence Procedures

    1. Explain the pay an employee may receive if they are off sick and what reporting procedure they should follow if they are unwell.

       
       

13. Family Leave Entitlements

    1. Explain what other types of special/family leave and pay the employee may be entitled to e.g. maternity, paternity, adoption, dependents leave, neonatal carer's leave etc.

       
       

14. Confidentiality and Non-Disclosure Agreements

    1. Include clauses about protecting company secrets and sensitive information.

    2. Emphasise the importance of confidentiality in the workplace.

    3. You should also include your data protection policy here.

       
       

15. Termination Conditions

    1. Clarify the notice period required by both parties.

    2. Define the grounds for termination

       
       

16. Disciplinary Procedures

    1. Explain the grounds for disciplinary action and the procedure which will be followed.

       
       

17. Grievance Procedures

    1. Explain how employees can raise concerns or complaints.

    2. Ensure there's a clear process for handling grievances fairly.

    3. Explain who the employee should raise their grievance to.

       
       

18. Collective Agreements

    1. Include details of any collective agreements which directly affect the terms and conditions of the employee.

---

Essentially...

Your contracts will need to align with UK employment law which is due to change at least every 6 months over the next two years!

You are able to change employment contracts of current staff, but you may need to follow a specific consultation process to do this, depending on the changes you wish to make.

We recommend reviewing your contracts of employment at least once a year to ensure you're up to date with current legislation. Here's how we can help you:

📝Get access to ready made contract templates (and much more) in our How to HR Toolkit

📝Get a bespoke contract drafted for your business by emailing info@lilachr.co.uk

📝If you're a retainer client, speak to your HR Adviser about updating your contracts.