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What is in an Employment Contract (continued) Click on a section number to go straight to a description or read the full article.
1. Names of both the employer and employee
2. Starting date of the employee
3. Job title and description
4. Address of the workplace(s)
5. Details of pay – hourly rate/salary and when it is paid (weekly/monthly)
6. Hours worked each week
7. Holiday entitlement
8. Sickness entitlement
9. Details of any pension schemes
10. If the employee is to work overseas – the period that they will work overseas and the currency in which remuneration will be paid for this period.
11. Grievance arrangements
12. Termination of Contract Notice
13. Redundancy
14. Disciplinary procedures
15. Signatures of both the employer and employee
9. If you employ 5 or more employees, by law, you must provide a pension scheme to your employees. If this applies to you, use this section to give details of any pension schemes that the employee is free to join. This pension is known as a Stakeholder Pension.
Example:
A Stakeholder pension scheme is provided for all employees. Details will be made available on starting employment.
10. If the employee is required to work overseas on a regular basis, give details of the time required to work overseas, the destination(s) (if known) and in what currency their wages will be paid (if different).
Give details of any requirements that need to be met by the employee, for example, the ownership of a valid passport.
11. You should outline a procedure for an employee to follow should an employee request absence for grievance.
Example:
In all but one instance, the Employee must report any grievance to their immediate supervisor. Where, and only where, the grievance is with the immediate supervisor, the Employee can make their grievance known to the immediate supervisor of the Employees supervisor.
12. The current law for notice periods is shown below. For the employee, the notice period is required as they may wish to terminate the contract to look for another job (it happens!): this notice gives the employer chance to find a replacement.
However, if the employer wants to terminate the contract, it will often be due to a misconduct charge by the employee. For example, if an employee is caught stealing money from the business (gross misconduct), the employer has rights to immediately dismiss the employee with no notice or payment.
If an employee repeatedly turns up late (minor misconduct) and has been given their written and verbal warnings, the employer may give the employee notice of their contract termination. If the employee has been working for 3 years, the employer may decide to give 3 weeks notice or dismiss the employee immediately with 3 weeks advanced pay.
It is good practise for notice – given by the employer or employee – to be posted to the employer’s/employee’s address as stated on the employment contract in section 1.
Example:
The minimum notice periods are as follows:
Time in Employment - Minimum Notice
Under 1 month - No Notice
Over 1 month - 1 Week
2 years’ service - 2 Weeks
3 to 12 years’ service One week for each year to a maximum of 12 Weeks.
The Employee must send a copy of their notice to the company’s address, as 1 above.
The Employer will send a copy of the notice to the Employees address, as 1 above.
In the case of the Employee being dismissed for gross misconduct, the Employer will decide if any notice period will be applied and/or worked.
For the following periods of employment, the employer/employee must give:
1 month = no notice required
Over 1 month = 1 week
2 years = 2 weeks
3 years = 3 weeks
4 years = 4 weeks
This trend continues until the maximum of 12 weeks notice for 12 or more year’s employment.
13. In the event of the employee being made redundant, you should outline the redundancy procedure and give details of how redundancy pay will be calculated. If the disciplinary procedure is not followed, the employer will be liable for unfair dismissal.
14. Inform the employee of the disciplinary procedures that will be taken should they be a victim of minor or gross conduct. You could point them in the direction of a separate document (state the document name and where it can be found) if you wish to go into a detailed account of the procedure and what you class to be ‘minor’ and ‘gross’ conduct.
You may also refer them back to section 12 detailing the notice periods of contract termination should the employer be dismissed on the grounds of minor misconduct.
Example:
Where the Employer believes that the Employee has acted in an unfit way in the course of carrying out their duty, or the Employee brings the Employers business in to disrepute, the Employee will face a disciplinary inquiry.
If the Employee is found to have committed a minor misconduct, the Employer has the option of a verbal warning (in writing), or a written warning depending on the severity of the misconduct.
If the Employee is found to have committed gross misconduct, the Employer has the option of a verbal warning (in writing), a written warning, a final written warning, or instant dismissal. The Employer also has the option to suspend the Employee where the Employer needs to make an inquiry into the misconduct.
15. At the end of the contract, you should have a section for both parties to print and sign their name. An area to print the date is also a key element. Article Index
1 Introduction2 Employment Contract
3 Employment Contract (continued) 4 Statutory Rights
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