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Employment contracts

Q: Do I have to give a written employment contract to all my employees”

Yes, the employer must provide a “written statement of particulars” within two months of the employment starting.

Q: What must be in a contract of employment?

• names of the employer and employee
• date when employment began
• date the employee’s continuous employment began
• rate of pay the method of calculating the remuneration
• intervals the remuneration is paid, i.e. weekly, monthly.
• terms and conditions relating to hours of work, including any terms and conditions relating to normal working hours
• terms and conditions relating to entitlement to holidays, including public holidays and holiday pay, so that they can be precisely calculated
• job title or a brief description of the type of work the employee is employed to do
• place of work or an indication that an employee is required to work at various locations.
• terms and conditions relating to incapacity for work due to sickness or injury, including any provision for sick pay
• terms and conditions relating to pension
• length of notice the employee is required to give and receive to terminate the contract
• where the employment is not intended to be permanent, the length it is intended to last, or the end date if it is for a fixed term
• any collective agreements, which directly affect the terms and conditions of employment, including where the employer is not a party, the persons by whom they were made
• where the employee is required to work outside the UK for a period of one month or more, details of the time they are to work abroad, the currency they will be paid in, any additional remuneration payable and any benefits provided because they work outside the UK and any terms relating to the employee’s return to the UK.

The written statement may also contain other clauses that an employer wishes to rely on.

Q: Can the employer change terms in the contract of employment?”

It depends on the terms you’re changing.

Some changes will be accepted without question and cause no problems.  For example, if you’re awarding a pay rise or changing a job title when someone is promoted, simply tell the person about the changes face-to-face in a confidential setting and confirm it in writing with a short letter.  Include the effective date of change.

If you’re making any other significant changes to contractual terms, it’s essential that you can show that you’ve acted reasonably as an employer, both to head off legal problems and also to keep your employees on-side.  The Human Resource provides tactical and strategic support to employers handling these situations.  This will include:

• Follow a proper consultative process.

• Ensure you can justify the change and the selection of the individuals whose terms are to change.

• Give people time to adjust to the change and help them to make the adjustment. 

• Ensure you have a good reason for exercising your power to change a contractual term, considering any problems or difficulties it may cause the employee. 

Q: What is a zero hours contract?

A zero hours contract means that the employer does not guarantee a set number of hours of work for the employee.  Depending on the needs of the business, the employee could be asked to work almost full time hours some weeks, or no hours at all other weeks – i.e. zero hours. 

Zero hours contracts can’t contain exclusivity clauses prohibiting staff from seeking or accepting work from another employer and people working them can seek additional employment and have other jobs.

Working hours

Q:  What breaks are employees entitled to during working hours?”

There are statutory limits on the hours anyone in the UK can work:

• 11 hours’ consecutive rest must be taken each working day.  If you work until late, for example to 10.30pm, you can’t start work again until 9.30am the next day.

• You’re entitled to a minimum rest break of 20 minutes away from your workplace after working over 6 consecutive hours. This means for example that if you started work at 9.30 am and worked continuously, at 3.30pm you should take a complete break of at least 20 minutes, such as a lunch or coffee break.

• The number of hours you work per week must not exceed 48 hours, averaged over a rolling 17-week period.

• Night workers are limited to an average of 8 hours work in 24 hours.

Q: Can we opt out of these rules?

The only part of the Regulations that has an opt-out clause is the 48-hour limit.  Employers can ask their staff to agree to work more than 48 hours a week in a 4-month period. However, employers cannot force employees to sign an opt-out: it must be agreed to and employees must not be dismissed for refusing to sign one.


Q: What is the minimum amount of holiday the employer has to pay?

Employees are entitled to 28 days' paid holiday (reduced pro rata for part-time employees). This may include the eight public holidays.

Q: Can the employer specify when the holiday leave must be taken?

Yes.  When leave is taken is mainly a contractual matter between the employer and employee.

Other time off work

Q: An employee took a day off work when his son broke his arm.  Should it be paid as a family emergency?

Employees do have a right to take emergency leave to deal with unexpected emergency situations involving someone who depends on them, for example when they need to:

o   help a dependent who falls ill, gives birth or is injured,

o   make arrangements for their care if they are ill or injured.

o   deal with an unexpected incident involving their child at school or with their child’s carer.

o   make arrangements for their longer term care.

However, the statutory right is to unpaid leave.  As an alternative, an agreement can be made to take the time from the employee’s paid holiday entitlement.

Q: One of my employees is requesting 4 months off work to look after his 4 year old.  Do I have to agree and do I have to pay it?

All employees with a year’s service have a right to Parental leave. For each child they have who is under the age of 5, they can take up to 18 weeks’ unpaid leave to care for the child.  All parental leave is unpaid and must normally be taken in blocks of one week, and requested from the line manager.  Entitlement to parental leave is more favourable and flexible for parents of a disabled child. 


Q: Does the employer have to give an employee paid time off work if someone close to them becomes terminally ill or dies?

There is no statutory requirement to do this, but it would be a hard-hearted employer who didn’t.  Many employers set guidelines on the amount of time they will pay in these situations of compassionate leave, part of as understanding and supportive as they can, and also consider each case individually.  


Q: Are employers responsible for checking that their employees have the right to work in the UK?

Yes definitely, and records should be kept to prove it.

There are tough penalties - maximum prison sentence of 5 years for employers who are prosecuted. Employers could be prosecuted if they knowingly employ someone illegally, and also if they have reasonable cause to believe they are doing so.  The Home Office is auditing companies every day and officials have powers to enter and search premises to investigate possible immigration offences, and they use them.  

Employers with solid policies and processes in place for checking right-to-work documentation are in a stronger position to defend their case if they’re found to be employing someone illegally.  To protect your business from liability and criminal prosecution:

• always obtain an original right to work document from the Home Office’s prescribed list before employment starts;

• check the authenticity and validity of the document in the presence of the employee in question; and

• keep a clear electronic and/or paper copy of the checked document with a note of the date of the check and initials of the individual who verified the document.

Employers are also responsible for ensuring their employees continue to have the right to work throughout their employment.  This means completing follow-up checks on those who have time-limited permission to work in the UK before their status expires.

Maternity and paternity rights

Q:  How much maternity leave does the employer have to give and how much of it must be paid?

Irrespective of length of service, pregnant employees are entitled to maternity leave of 52 weeks.

Depending on length of service, pay is normally 90% of average weekly earnings for the first 6 weeks then the Statutory Maternity Pay (SMP) rate for the remaining 33 weeks. 13 weeks is therefore unpaid.

The pregnant employee needs to have at least 26 weeks’ service with their employer at the 25th week of pregnancy to be eligible for Statutory Maternity Pay.  If you have been with the company for a shorter time, instead they may receive a maternity allowance from the DSS.

Q:  How much paternity leave does the employer have to give and how much of it must be paid?

New fathers are legally entitled to take up to 2 consecutive weeks’ paternity leave when their baby is first born.  It can be taken as a block anytime within 8 weeks of the birth.  This is paid at the statutory Ordinary Paternity Leave (OPL) rate.

To be eligible, they must have worked for the company for at least 26 weeks before the 25th week of the pregnancy, and still be employed by the same company on the date of birth. 

There are also legal requirements that men taking paternity leave must notify their manager in writing 15 weeks before the date the baby is due and give 28 days’ notice if they wish to change the start date. 

Q: Can I recoup the statutory payments I make to employees from the government?

An employer is able to recover the cost of SMP (Statutory Maternity Pay), SPP (Statutory Paternity Pay) and SAP (Statutory Adoption Pay) from the government. The amount that can be recovered depends on the annual National Insurance payments made by the employer.

Q: An employee has asked to take shared parental leave, what should I do?

Refer anyone enquiring about it to the free online advice on the government’s website https://www.gov.uk/pay-leave-for-parents, where they can use the pay and leave calculator to check their eligibility.  If they’re applying, they should download the forms, complete them and give them to you as “Notice of entitlement and intention to take SPL”. 

The employer isn’t responsible for checking anything about the leave being shared with their employee’s partner, the onus is entirely on the employee to declare the arrangements on the forms.

This written application for shared parental leave needs to be with the employer 8 weeks beforehand.  This will give time to organise temporary cover for the employee's work, which may be needed for 50 weeks. 

Both parents can take up to 50 weeks of leave shared between them following the birth of their child, in one continuous block or in several blocks.  37 of these weeks are paid at the statutory SPL rate.  Shared parental leave needs to be taken within 52 weeks of the child’s birth. 

Pension automatic enrollment

Q: My accountant will deal with Pension automatic enrollment so I don't need to do anything.  Right?

WRONG!  The employer is personally responsible for complying with Pensions Auto Enrolment requirements and there are stiff fines for failing to do this. 

If your accountant runs your payroll they will be able to advise you about the payroll deduction process and they may have the software to produce the standard letters required. However most accountants are not licensed to deal the legal requirements about pensions enrolment and selecting a pension scheme.

Q: We’re not interested in Pensions Auto Enrolment.  So my company is opting out.

WRONG!  Individual employees can opt out after they’re automatically enrolled, but companies can’t. 

The roll out is being phased in by size of business to be completed by 1st February 2018. The Pensions Regulator knows exactly who is employing how many people via their PAYE code.  Your company will receive a letter from the Pensions Regulator giving your staging date (the go-live day for auto-enrolment in your business). There’s a long list of difficult policy decisions and complex processes that employers must implement with deadlines.  

It’s a highly complex piece of legislation and already a number of larger employers have been fined for non-compliance. The legislation really does have teeth.

Q: Presumably my company will be automatically enrolled - so we don’t need to do anything.

WRONG!  You are entirely responsible as the employer and nothing will happen automatically unless you make it happen.  It’s called automatic enrolment because it is automatic for staff – they don't have to do anything to be enrolled into their employer’s pension scheme, but it is not automatic for the employer. The employer is responsible for taking steps to make sure their eligible staff are enrolled into a pension scheme.


Q: What is a fair dismissal?

Employees have the right not to be unfairly dismissed.

Dismissal is normally fair if an employer can show that it is for one of the following reasons:

• a reason related to an employee's conduct

• a reason related to an employee's capability or qualifications for the job

• because of a redundancy

• because a statutory duty or restriction prohibited the employment being continued

• some other substantial reason of a kind which justifies the dismissal.

And that they acted reasonably in treating that reason as sufficient for dismissal. 

Q: Can the employer sack anyone with less than 2 years’ service without going through the disciplinary process?

Employees normally require two years’ continuous service in order to be able to claim unfair dismissal.  However there are important exceptions where a claim can still be made without any length of service requirement.  These are dismissals classed as 'automatically unfair' where the grounds for dismissal are connected with an employee exercising specific rights relating to:

• pregnancy, including all reasons relating to maternity

• family reasons, including parental leave, paternity leave, adoption leave or time off for dependants

• representation, including acting as an employee representative

• trade union membership grounds and union recognition

• part-time and fixed-term employees

• pay and working hours: including the Working Time Regulations, annual leave and the National Minimum Wage.

Q: An employee has resigned and is taking the employer to an employment tribunal for constructive dismissal. What does this mean?

A constructive dismissal claim is one where the employee has resigned in circumstances where they felt forced to do so because of the employer’s behaviour. A constructive dismissal claim will always be an unfair dismissal claim, and if the person did not receive their full notice payment it will be a wrongful dismissal claim as well.

To prove a constructive unfair dismissal, an employee must demonstrate that:

• the employer has breached the contract and

• this is a significant or fundamental breach of contract and

• they terminated their employment in response to that breach and did not delay resigning.

Q: How much would an employment tribunal fine the employer if the case goes against them?

In wrongful dismissal claims, damages are calculated as for any other breach of contract so an employee will be entitled to their full net salary for the contractual notice period, and compensation for loss of other benefits for that period.

Unfair dismissal awards are made up of:

A basic award, to compensate for loss of job security calculated on the basis of the employee's age and years of service multiplied by a maximum weekly amount. The current weekly amount is £479 - it is indexed linked and usually changes every year. The maximum basic award is currently £14,370.

A compensatory award in addition to the basic award. This reflects immediate and future loss of earnings. The current maximum award is £78,962 or 12 months' gross pay or a set amount, whichever is the lower.

Therefore a ££93,332 cap.

The unfair dismissal compensation limit may be higher for:

• discrimination cases

• dismissals on health and safety grounds

• dismissals falling within the whistleblowing provisions of the Public Interest Disclosure Act 1998.

If a tribunal orders that the claimant should be reinstated but the employer does not comply, a tribunal may award from 26 weeks' to 52 weeks' pay as an additional award.