Contracts of Employment

Written Contracts

Once an employer has offered a job and the offer has been accepted there is a legal contract between employer and employee, even if there is nothing in writing. If an offer has been made and accepted and the employer withdraws it, it may be possible to claim damages for breach of contract.

Employees have the right to written particulars of the contract. No later than two months after the beginning of employment, every employee must be given a written statement that must include:

  • the names of the employer and employee;
  • the date of employment began and the period of continuous employment;
  • the scale and rate of remuneration, pay intervals and its method of calculation;
  • terms and conditions relating to hours of work and holiday entitlement (including public holidays);
  • the job title or description; and
  • the employee's place of work.

The written statement will also need to contain details of the employer's disciplinary and grievance procedures.

Rights under the Contract of Employment

The contract of employment is the agreement made between the employer and the employee. This could be in the form of a written agreement or what has been agreed verbally between them.

In addition, the contract of employment will also include 'custom and practice' agreements. These are how things are usually done in the workplace, for example, if the employer always gives the employees a day's holiday in August. Even though this is not mentioned in the written contract this will form part of the contract of employment as it is the usual practice.

If the written contract says one thing, but in practice all the employees have been doing something else with the employer's knowledge, the 'custom and practice' would form the contract rather than the written statement.

A trade union may have negotiated an agreement with an employer about conditions at work. The negotiated agreement will often form part of a contract of employment, particularly if the conditions negotiated are more favourable than the previous ones.


Illegal contracts of employment

Some contracts of employment will be illegal if:

  • the employee gets all or part of their wages as 'cash in hand'; and
  • tax and national insurance contributions are not paid; and
  • the employee knows they are getting paid in this way to avoid paying national insurance and tax.

Written statement of the main terms and conditions of employment

All employees, regardless of the number of hours they work per week, are entitled to receive a written statement from their employer, within two months of starting work. The statement describes the main terms of the contract of employment.

The statement must give details about:

  • job title
  • wages
  • hours of work
  • holiday entitlement
  • sick pay
  • pension schemes
  • notice
  • grievance, dismissal and disciplinary procedure.