Employment contracts are an important part of nearly everyone’s employment. It defines the work to be done, the compensation that will be paid, and how any issues or concerns will be handled. Often combined with company-wide policies found in employee handbooks and applicable laws, this contract helps everyone know what to expect from each other.

An employment contract is a legally binding agreement between the employee and the employer. Whether it’s agreed to in writing or verbally, it binds both parties to the terms of the agreement.

Any employee or worker hired after April 2020 is entitled to a written ‘statement of employment particulars.’ Essentially, this would include things like the hours of the work, the pay, etc. Anyone who was employed prior to April 2020 is not legally entitled to a written statement, but most employers will provide one if asked as many have already created them for the entire staff.

What does an employment contract include?

According to the UK government website, this is a list of what must be included in an employment contract:

• The company name
• The name of the worker or employee, the job title or an explanation of the work, and the start date
• Hours and days of labour, as well as how often and how much they will be paid, are disclosed (also if employees or workers will have to work Sundays, nights or overtime)
• Holiday entitlement (and whether that includes public holidays),
• The location(s) where an employee or worker will work, whether or not they might have to relocate, the locations of any new jobs, and the employer’s address.
• How long a job is expected to last (and when, if it’s a fixed-term contract, its termination date)
• The length of any probationary period
• Other benefits, such as childcare, lunch, etc.
• Mandatory training and whether it’s paid for by the employer

Types of employment status

There are three main types of employment status: worker, employee, and self-employed.

How your employment is defined affects what employment rights you have. While the terms worker and employee are often interchangeable in everyday conversation, in an employment contract they are legally defined terms that affect everything about your work.

Note: Your employment status for your worker’s rights is not the same as your employment status for tax purposes.

Checking your employment status

If you have an employment contract, your status is usually clearly defined, but directors, officers, and volunteers in CICs can find themselves in a murky area between roles.

The UK government has defined what your employment rights are as well. Each position has been identified as to what is expected and what you should get for your efforts.

Need help with all of this?

The easiest way to make sure that you’re meeting all the legal obligations, operating inside of your contracts, and providing the best experience for yourself and your staff is to hire a professional payroll service.

At KG Accountants, we help you keep your contracts in order, meet all your obligations, and keep your payroll up to date at every level.

Visit us at KG Accountants or call us at 0207 953 8913.

Categories: contracts, Employment and related matters, Employment issues, Staff

Tags: employment contracts, How do I employ someone in a CIC, Payroll, Salary, Staff contracts, Wage