Why Employee Contracts Can Save Your Skin

Employing somebody without putting in place an employee contract is much like jumping from a plane without a parachute. It’s extremely likely to end in tears.

If there’s one thing we’ve learnt from our experience in HR, it’s that every employee-employer relationship should be underpinned by an employee contract. Without one, you could be setting yourself up for quite the headache (not to mention a financial kick in the nether regions).

The Employment Rights Act 1996 requires you to give all employees ‘written particulars’ of employment within two months of their employment. But don’t be fooled – this is not an all-singing, all-dancing contract of employment that will protect you when the proverbial hits the fan. It merely outlines the core terms of employment such as job title, place of employment, frequency of pay, hours of working, holiday entitlement, etc. etc.

These are the bare bones of someone’s employment, but they barely skim the service when it comes to setting out the dos and don’ts that will, ultimately, protect you from all sorts of carnage.

The crux of the issue is this: without a watertight written contract of employment, neither you nor your employee knows the precise extent of their rights, duties and obligations. Which means, quite simply, there are no rules to follow and no consequences to fear. It’s like a society with no government, law and order. Things are going to get messy, and the person that will be clearing it up is you.

The issues you should lay out in your contract and/or employee handbook are pretty vast: What’s your position on social media? How will you handle suspiciously long absences? What’s the procedure surrounding grievances? Which actions could result in dismissal?

The list goes on. But it needs to be comprehensive and, from a business owner’s point of view, commercially viable. The more grey areas surrounding your employment terms, the more likely you are to be caught out. And at no point do you want to be in a position where you have no leg to stand on, especially if you’re put in front of an employment tribunal.

A well-written employee contract and handbook will leave no stone unturned so that the underbelly of your business is thoroughly protected. So by all means throw yourself out of the plane, but do put your parachute on first…

If you’d like help or advice with your employee contracts and policies and procedures, give us a call.

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