With recent changes in legislation, there are more requirements on employers to issue contracts in a timelier fashion and also to be careful about content and wording – we list below some of the issues to look out for:
- Issuing a contract: Employers must now give a prospective employee either an offer letter or a full contract within 5 days of commencing the job. There are a number of basic details that must be included so if you can’t get a contract organised quickly, we suggest that you issue an offer letter with the basic legal requirements setting out the 5 core terms (Name of Employee and Employer, Address of Employer, Expected duration of contract if fixed term or temporary, Rate and Method of calculating pay and Expected normal length of working day and week) and follow up with a full contract when you have this ready
- Fixed-term contracts: These contracts are really beneficial – particularly for SMEs who can’t either afford to take an employee permanently or have a short-term need to cover. A recent ruling however has raised an issue that is important to be aware of. If you state in the fixed-term contract that you may extend it at the end of the contract period, but that there will be contingencies to be considered before you extend the contract – such as working certain hours, or completing satisfactory service – then the fixed-term contract may be considered void, as you are imposing contingencies on future employment that hasn’t been confirmed. In a recent case in the High Court a school was told that the fixed-term contract was not valid, as they had imposed contingencies that implied a permanent contract of employment – even though a fixed-term contract was given. So, ensuring appropriate wording in fixed-term contracts is essential.
- Fixed-purpose contracts: This is an excellent way of covering particular situations – such as maternity leave, long-term parental leave, etc. However, it is essential that the terms are clear. If you employ an individual to cover a maternity leave, they should not be placed on other tasks, or transferred into other work/positions as this will breach the terms of the contract. Again, care must be taken in the application of this contract.
- What if you have NO contract in place? Don’t panic- you are non-compliant, and the main issue is to ensure that you resolve this. Issuing retrospective contracts is certainly better than no contract – just take care again in the wording and the detail and take advice if the employee is unhappy or unwilling to sign the contract.
Employment contracts – well written and appropriate – are both essential and very valuable for both the employer and employee -so taking the time to ensure that they are compliant, appropriate and customised to suit the business – is really worthwhile. For further information please contact Voltedge for expert advice. Just email us on firstname.lastname@example.org or call Ingrid on 01 5252914.