An employment contract is an extremely important document for any business. It is a legally binding contract between an employer and the new employee; therefore it is vital that it includes all of your unique requirements along with the standard terms.

The reason why your employment contract takes on so much importance is that it can save you a lot of problems further down the line. As already stated, it is a legally binding document, therefore when the signees put pen to paper they need to abide by what is written. If you overlook seemingly small issues, an eagle-eyed employee could later use this to their advantage.

There have been many instances where people have successfully sued former employees in a tribunal due to breaks in their contractual agreements. To avoid this kind of situation you need to include as much essential information with precise clarity in the initial employment contract. This way both parties are covered and have a clear understanding of what is expected.

So what kind of things should you be looking to include?

Well, you need to give a clear indication of disciplinary procedures. If you offer clear advice on when an employee may be disciplined and to what degree, i.e. suspension or dismissal, you should cover this adequately.

You should also include details on annual leave and your sick pay policy. This will differ from company to company, therefore you have to ensure that the new member of staff is fully aware and has agreed to the terms of the employment contract. By including this within the document you cover yourself against employees taking excessive time off and leaving you short on staff.

Essentially you are setting a business protocol that all staff must abide by, including management. Whilst much of the information contained within the employment contract may never be used, it is vital that you have it in place to ensure that everybody is fully aware of their legal rights and those of the company.

Remember to include anything that is individual to your company. There are a variety of standardised templates available, but these won’t cover you for everything. For example you might be a company that handles a lot of sensitive information or data. In this situation you need to make sure that this is covered and the legal ramifications of misusing this are outlined.

Of course you also have to include an overview of the role itself. This will possibly change from person to person within the company, so again you need to be precise about the duties they will be doing and the job title they hold.

Similarly, and it might sound straightforward, but you have to include the address of your primary place of work and any other locations that you may work. You should also include the employers address too.

Starting pay and working hours also need to be included. Again this is just to ensure that both parties have agreed and that this will be the starting rate. If you have a pension scheme, health benefits or any other bonus scheme, this should also be contained within your employment contract.

Finally, don’t forget about your notice period. Whilst the standard notice might be a month, some businesses have a longer period, so be clear and ensure that the employee is well aware of the situation. You should also include any information on when this may be terminated earlier, i.e. in the case of a disciplinary or if gardening leave is offered.

That is pretty much it. Whilst some might be obvious, other segments of the employment contract require great thought and need to be properly developed to cover each individual member of staff.

ABOUT THE WRITER

Vincent Rogers is a freelance writer who represents a number of UK businesses. For employment documents, he recommends Cleardocs, one of the UK’s leading suppliers of  Standard Employment Contracts.

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