A contract of employment, also known as a contract of service or statement of terms and conditions, is a document that sets out the framework for the relationship between an employer and employee. But what makes a good employment contract? ELAS employment law consultant Liam Grime looks at the key points:

Employment law is derived from contract law in that for any employment relationship to exist, there must first be a contract in place. Although a contract of employment can be established verbally, both employers and employees will find it beneficial to have a physical contract drawn up to help avoid any misunderstanding, uncertainty or doubt as to what the terms of their relationship are. One key to writing good employment contracts is ensuring that whoever writes the contract is aware of what must be included and that the document is both compliant with current legislation and reader friendly.

The Employment Rights Act 1996 sets out employees’ statutory rights and protection. The law provides that employers who have not given an employee a written contract must provide a Statement of Initial Employment Particulars, also known as an S1 Statement, no later than eight weeks after the employee begins work. Failure to provide this could lead to a tribunal claim which, if successful, could see the claimant being awarded two to four weeks’ pay. When drafting employment contracts, employers need to ensure that anything that is required to be in the S1 statement is present in the contract of employment.

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