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Employment Contracts and Terms and Conditions

Your employment contract sets out the terms and conditions of your job, and may give you rights beyond those you have by law.

While your employer must obey the laws that give you your rights at work, you may have other rights which will be set out in your employment contract. This includes such things as the responsibilities of your job and how much you will be paid, and can be just as important as your statutory employment rights.

Contracts of employment

A contract of employment is the agreement between you and your employer regarding the details of the job. The purpose of a contract of employment is to set out the terms and conditions of your employment, including your rights and responsibilities.

An employment contract does not have to be an actual written document; it could simply be something you have discussed verbally with your employer. It is important to note that a contract cannot take away rights you already have by law. If an employer gets you to sign a contract which says that a statutory right does not apply, this part of the contract will be automatically void.

A contract can, however, give you additional rights beyond those granted by the law. For example, if you have a statutory right to 28 days of paid holiday, but your contract says that you can take 30 days of paid holiday, your employer should give you the 30 days promised.

Contracts are also seen as including what are known as 'implied terms', which are things that are so obvious that they do not need to be written down (or are legal requirements). For example, it does not need to state in your contract that the workplace should be safe, or that you should not steal from your employer, for these expectations to be in force.

One important implied term is that of 'mutual trust and confidence'. This means that neither the employer nor the employee should act in a way as to undermine the employment relationship. Both parties should avoid treating the other in an unreasonable or unfair manner which will cause a breakdown between the two, as this would allow the victim to treat the employment contract as having been brought to an end.

Another specific kind of implied term is what is known as ‘custom and practice’. If something is always done in a certain way in the workplace and everyone involved approves of this, it can be considered part of the employment contract, even if it is not written down. For example, if an employer has always paid a particular rate for overtime work, employees should view this as something to which they have a contractual right, even if it has never been written down or specifically discussed.

‘Custom and practice’ can even replace written terms of employment, if they clash. For example, if your employment contract says that you must give a month’s notice to take time off, but in practice everyone simply puts in their requests the week before their holiday, this shorter notice period for time off can be viewed as having replaced the one described in the written contract.

The main terms and conditions of employment

Within two months of starting work, all employees are entitled to receive a written statement describing the most important terms of their employment contract. Your employer may not provide this to you unless you ask, but once you have requested it they are legally required to supply it.

This statement should contain details of:

  • your name and the name of your employer
  • the date you started working for them
  • your job title
  • your wages and how often they will be paid
  • the hours you work
  • your entitlement to paid holiday and how much time you may take off
  • the company’s sick leave policy
  • the location of the job and whether you may have to work at more than one site
  • details of any company pension schemes
  • the notice period your employer will give you if you are dismissed, and the amount of notice you must give them if you wish to leave
  • disciplinary, grievance and dismissal procedures

It is important to note that not all of this information needs to be supplied in a single statement; for example, your employer may supply staff handbooks or other documents which explain procedures and policies which are universal across the company.

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