The making and acceptance of an offer of employment forms a legally binding agreement between the employer and employee.
The offer of employment should contain the following:
- key terms of employment; job title, pay and any benefits
- hours, place of work
- start date and any probationary period.
The offer of employment can be made orally, in writing, or through a combination of the two. However, it is better to give the employee the terms in writing before they start work to avoid any potential disagreements or misunderstandings at a later stage.
A contract of employment commences as soon as the job offer is accepted.
Within two months of commencement of employment, you must give the new employee their terms and conditions of employment in an employment contract. This is also known as a Section Statement as it is a legal requirement set out in S.1 of the Employment Rights Act 1996. It is also good practice to provide this on the employees first working day.
UK Employee Contracts
The Section 1 Statement or the employment contract must contain:
- Name of the employer and employee
- Date the employment and continuous employment started
- Job location
- Pay and frequency of pay, weekly, monthly etc.
- Working hours
- Holiday entitlement
- Job description/job title
- Details of any collective agreement that directly affect the employee’s conditions of employment.
UK employee rights for overseas companies
The employer should also provide other documents such as staff handbooks, or staff intranet sites for:
- Sick leave and pay entitlement
- Pensions and pension schemes
- Disciplinary and grievance procedures
- appeals procedure under the disciplinary and grievance procedures.
A S.1 Statement is not itself a contract of employment but is evidence of the contract of employment. It is normal, however, for employers to provide new employees with a full employment contract containing all the particulars required by S.1 of the Employment Rights Act in addition to all of the express employment terms including but not limited to:
- Maternity/Paternity rights
- Retirement age
- Policies and procedures including, but not limited to: sickness/unpaid leave, expenses, staff travel, vehicle/telephone use etc.
Failure to comply with the strict employment regulations may leave you exposed to potential legal exposure and your company might end up in an employment tribunal.