How to Write a UK Employment Contract

Legal Requirements

Since April 2020, all employees and workers in the UK must receive a written statement of employment particulars on or before their first day of work. This is a legal requirement under Section 1 of the Employment Rights Act 1996 (as amended by the Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018).

The written statement is the minimum requirement. Most employers issue a more comprehensive employment contract that includes additional terms.

Mandatory Terms (Day One)

The following must be provided on or before the employee's start date:

Section 1 Statement (principal statement)

1. Employer's name
2. Employee's name
3. Date employment began (and continuous service date if different)
4. Job title or brief job description
5. Place of work (or statement that the employee works at various locations)
6. Pay: Amount, frequency (weekly/monthly), and method of payment
7. Hours of work: Normal working hours and days, whether variable, and overtime requirements
8. Holiday entitlement: Including bank holidays, how it accrues, and the holiday year
9. Sick pay and absence: SSP arrangements and any company sick pay scheme
10. Pension: Details of pension scheme(s) and auto-enrolment
11. Notice periods: Required from both employer and employee
12. Duration: Whether permanent, fixed-term, or temporary (including end date for fixed-term)
13. Probationary period: Duration and conditions
14. Training requirements: Any mandatory training, and whether it is paid for by the employer
15. Benefits: Non-pay benefits provided (car, health insurance, etc.)

Supplementary Statement (within 2 months)

16. Disciplinary procedures: Reference to the company's disciplinary rules and procedure, or the full text
17. Grievance procedures: How to raise a grievance and the procedure to be followed
18. Collective agreements: Any collective agreements that affect the terms
19. Overseas work: If the employee will work outside the UK for more than a month, the details

Additional Recommended Clauses

Beyond the statutory minimum, a robust employment contract typically includes:

Confidentiality

• Definition of confidential information
• Obligations during and after employment
• Consequences of breach

Intellectual Property

• Ownership of work created during employment
• Moral rights waiver where applicable
• Obligation to disclose inventions

Restrictive Covenants

• Non-compete: Restriction on working for a competitor (typically 3-12 months)
• Non-solicitation: Restriction on approaching clients or suppliers
• Non-poaching: Restriction on recruiting colleagues
• Non-dealing: Restriction on doing business with clients

Restrictions must be reasonable in scope, duration, and geography to be enforceable.

Garden Leave

• Right to require the employee to stay at home during the notice period
• Continuation of pay and benefits
• Restrictions during garden leave

Deductions from Pay

• Authorisation for lawful deductions (overpayments, training costs, equipment)
• Must comply with the Employment Rights Act 1996 restrictions on deductions

Common Mistakes

1. Not issuing on day one: Since April 2020, the written statement must be provided on or before the start date, not within 2 months
2. Vague job descriptions: "Various duties as required" is insufficient. Specify the core responsibilities.
3. Unreasonable restrictive covenants: Over-broad non-competes are unenforceable. A 12-month restriction with worldwide scope will rarely survive court scrutiny for most roles.
4. Missing probation terms: If you have a probation period, the contract must state it, including the length and notice period during probation
5. Failing to update: When terms change (pay rise, new role, change in hours), issue a written amendment
6. Mixing up employees and workers: Workers have fewer statutory rights but are still entitled to a written statement

Changing Contract Terms

Employers cannot unilaterally change employment contract terms. Options include:

• Agreement: Negotiate the change with the employee and confirm in writing
• Variation clause: Some contracts include a clause allowing reasonable changes with notice
• Collective agreement: Changes can be implemented through a collective agreement with a trade union
• Dismissal and re-engagement: As a last resort, dismiss on proper notice and offer re-engagement on new terms (carries significant legal risk)

How Grove HR Helps

Grove HR includes employment contract templates that comply with current UK legislation, tracks when contracts are issued and signed (with e-signature support), manages contract amendments with full version history, and alerts when mandatory terms are missing.