Formal Contracts Of Employment | Legal Advice For SMEs

It’s common for small businesses to believe that they don’t need to issue all employees with a contract. The law however is clear - businesses of all sizes must issue a written statement of particulars to an employee within eight weeks of starting employment. There is no exception, whether you have one employee or 10,000.

What Must I Provide To My Employees?

As a minimum, you must give your employees a written statement of particulars of employment. This should cover mandatory terms such as: 

  • Remuneration
  • Holiday pay
  • Sick pay
  • Notice periods for terminating the contract

What Is The Impact Of Not Complying With These Regulations?

There are a number of penalties associated with the failure to issue a statement of particulars. If an employee makes a claim at an Employment Tribunal and the failure to issue a statement is cited along with another claim such as unfair dismissal, the Tribunal can award up to four weeks of statutory pay.

Small and medium-sized businesses may find that the penalty awarded at a Tribunal is not the most serious consequence of failing to put employment contracts in place. As well as covering sick pay, holiday pay and other statutory requirements, you can also use a contract to protect your business from risk.

For example, a contract could have clauses covering: 

  • Confidentiality of sensitive business information
  • The ownership of intellectual property rights
  • Restrictive covenants
  • Offering and regulating incentive payments such as bonuses and commission

Our employment law experts can offer advice and help you draft commercially focused contracts that not only protect you from Employment Tribunal claims but also suit the needs of your business.

Contact Us For Help Dealing With Employment Contracts

If you would like help drafting employment contracts, contact Fergal Dowling on 0121 214 5476 or get in touch online.

Legal Helpline

Book a call with one of our expert advisors for fixed-price legal help at a time that suits you.

Find out more

Contact Our SME Team

Need help with a specific legal issue? Contact us to find out how we could help.

Get in touch online