Your contract of employment: the facts and the must-haves

A contract of employment is a legally binding contract between an employee and their employer. It may be written or verbal, or a mixture of both. A contract of employment provides rights and responsibilities for both you, as an employee, and your employer.

Once you accept an unconditional job offer, you automatically enter a legal agreement to take on that role and obtain the right to a written statement of the terms of your employment. However, this isn’t the same as a contract of employment.

Is it essential to have a written contract of employment?

There are two ways to answer this question. First, is it essential in a legal sense, and second, is it essential for you as an employee?

  Is it legally essential?

In the UK, you automatically enter a legally binding contract of employment the moment that you accept an unconditional job offer. The employer has no legal obligation to provide a written contract of employment. However, they must provide a written statement of terms.

So no, it is not legally essential to have a written contract of employment.

  Is it essential for you as an employee?

It is not essential for you to have a written contract of employment if you receive a written statement of terms. However, it is to your benefit to have a written employment contract for several reasons:

• It provides further evidence of the terms of your employment beyond the written statement.
• It prevents misunderstandings over the conditions of your employment.
• It simplifies the process of making a complaint to or against your employer, should your employer breach your contract of employment.
• A contract of employment can be changed to reflect changes to your conditions of employment, such as increased salary or a change to flexible working.

The terms of a contract of employment

The concept of a contract of employment can be confusing because it doesn’t have to be a written document. It can be a verbal agreement or communicated to you in a variety of ways:

• verbally
• in a written statement of employment terms
• in a written employment contract
• in an employee handbook
• in your offer letter
• in a collective agreement, for instance, between the employer and a trade union

If you don’t have a written contract of employment, the particulars of your rights and responsibilities, and those of your employer, can be scattered over a range of communications and difficult to track or tie-down.

The terms of your contract of employment will generally be one of four types:

• Express terms are the details that are specific to you and your job, for instance, salary and how many hours you work each week.
• Implicit terms are those conditions of employment that are felt too obvious to be written down, such as that you won’t turn up to work in an unfit state and that you won’t steal from your employer.
• Statutory terms are conditions relating to employment law that the employer must adhere to, such as minimum wage and maternity leave and pay.
• Incorporated terms are conditions that are recorded in another document such as the employee handbook. They generally apply to the entire workforce, for instance, entitlement to breaks.

What is included in a written statement of employment particulars?

By law, an employer must provide you with a written statement of employment particulars. This is made up of the principal statement and a wider written statement. The principal statement must be provided on your first day of employment. The wider written statement must be provided within your first two months in the job. There are legal requirements for what each of these must contain.

As a minimum, the principal statement must include:

• employer’s name
• employee name
• job title or description of work
• start date
• what you will be paid
• hours and days of work with any variations
• holiday entitlement
• where you will usually work, whether this will require you to relocate, and other work locations
• in the case of a fixed term contract, the expected length of employment and end date
• length and details of any probation period
• employee benefits
• obligatory training and whether paid for by the employer
• where this is an internal move with the same employer, the start date of the previous job if it counts towards continuous employment
• where you will work outside the UK for more than a month,
  • how long you’ll be abroad
  • the currency you’ll be paid in
  • any additional pay or benefits
  • details of your return to the UK

The wider written statement must include information about pensions, collective agreements, your employee rights to non-compulsory training provided by the employer, and disciplinary and grievance procedures.

What else must your employer tell you from day one?

In addition to the written statement of employment particulars, your employer must tell you about the following on the first day of your employment:

• sick pay and procedures
• paid leave other than standard, such as parental leave
• your notice period

Final Thoughts

When you accept an unconditional job offer, you automatically enter a legally binding contract of employment with the employer. This doesn’t mean that you’ll receive a written contract, although increasingly employers do provide an employment contract by email or in a paper format. However, you have a legal right to a written statement of employment particulars which lays out the terms of your employment.