23 July 2015
What is an Employment Contract and What Should it Say?
An employment contract is a legally binding agreement between an employer and an employee. It’s best to make sure you have your contract in writing as it makes up the basis of your employment relationship.
What Should an Employment Contract Include?
An employment contract should include the business name or the name of the employer as well as your name and your start date. It should also say your job title and give a description of the work that you will be carrying out in the form of a job specification.
As well as stating your hours of work your employment contract should also tell where you will be working. The place(s) of work stated in your contract should inform you as to whether you will have to relocate in order to take up the job.
Your employment contract should detail all they ways in which you get rewarded for the work you do. This should include your salary, how often and when you will get paid. You might also qualify for a bonus in addition to your salary; if so, the conditions of this bonus should be specified in your contract.
You should also be notified on any deductions you will be subject to, as well as circumstances in which your employer can make deductions from your salary and any expenses you can claim for.
Contracts should include details on sickness and disability, which include what happens when you are unable to work due to sickness or injury. You ought to check to see if there is any provision for sick pay in your contract of employment.
You will also be keen to find out your holiday entitlement, which must be included within your contract, and your holiday pay. Also worth considering is how your employer would calculate your accrued holiday pay upon termination of employment.
Your employer must have a retirement policy. This could be separate from your contract of employment, but it is worth requesting a copy so that you can examine it.
Your employment contract should set out the specifics of your pension or pension scheme.
Your contract might include restrictive covenants in order to protect confidential and commercial information. Restrictive covenants can prevent you from leaving for a competitor or setting up a competing business.
An employment contract should state what happens if you were to breach the terms of the restrictive covenant. Breaching your restrictive covenant is likely to entitle your employer to seek legal redress and regain damages for any losses they suffered as a result of the breach.
Most employers have a staff handbook which is often referred to in the contract of employment. It may well contain some important contractual terms and policies by which you must abide. Therefore, you should always ask for a copy of the staff handbook and read it before you sign the contract.
Grievance and Disciplinary Procedure
This is not something that you might look for when reading through your contract, but it is important. Ensure your contract includes details about who you can go to if you have a grievance, how to complain about the way in which a grievance is handled and how to complain about a disciplinary or dismissal decision.
Whilst it does not need to cover grievance, disciplinary and dismissal procedures, your contract of employment must say where you can find out this information.
Probationary and Notice Period
The notice period clause in your contract should give instruction on how long both the employer and the employee would need to give before you stop working together. This clause in your contract should also detail what would constitute gross misconduct and therefore allow your employer to dismiss you without giving notice.
Your employer can specify in your contract a trial period, known as a probationary period, which often has a shorter notice period attached to it for both the employer and employee. Employers can extend your probationary period.
Slater and Gordon’s Employment Contract Solicitors can advise you on problems with employment contracts and assist you in negotiating new terms. To see what we can do for you call us on freephone 0800 916 9060 or contact us online.