WOULD YOU RIDE A MOTORCYCLE WITH ONLY A HELMET AND NO CLOTHES?

Many small businesses owners are treading a tight rope by assuming that because they only employ a handful of staff, they do not need to draft appropriate employment contracts for their employees. However, this is a dangerous game to play for owners of businesses and a game that is often won by employees if a dispute arises and moves to an Employment Tribunal.

Legal Obligations

Employers are obliged to provide their employees with a written Statement of Terms within 8 weeks of commencing employment. This statement must contain information relating to 14 key headings but even then, employers are able to leave these headings blank if they are not appropriate to the specific employee. This must be recorded on the document though for future reference. However, a statement of terms is not a legally binding contract as it merely states what the contract terms are and is not the contract itself.

Currently, there is no specific legal requirement for a written contract of employment to be drafted between employer and employee. If desired, an employer is well within rights to agree an Employment Contract verbally with their employee. However, motorcyclists are only obliged by law to wear a helmet when riding but next time you see one on the road you will note that they have further protected themselves by wearing protective gloves, jacket, trousers and boots.

So why create an Employment Contract?

A Contract of Employment that is agreed by employer and employee results in a legally binding agreement provided that the terms are reasonable. Straight away, the employer and employee both understand and agree their specific obligations to one another in the course of their employment relationship.

Additionally, small businesses have their own particular nuances that are integral to the running and survival of the company so an Employment Contract can specify these details and thereby ensure the security of the business.

The role of a Statement of Employment is a procedural standard where as an Employment Contract provides the employee with more comprehensive information than a Statement is able.

Verbal Agreements of Contracts of Employment
Although legally permissible, if a dispute arises then it will be a case of the employer’s word against the employees when the matter reaches stages of going to Tribunal. For any Tribunal, deciding on who is right or wrong can prove to be a lottery as the case relies on such little evidence. It is clear though, that small businesses are always the ones to suffer in this circumstance with a loss of revenue attributable to time spent dealing with the situation, not to mention the associated stress involved.

How to draft a Contract of Employment
The creation of this document can be relatively straight forward and inexpensive but it is a matter that must be dealt with through your legal representative. Buckles Solicitors LLP are have a dedicated Employment team that are available to advise you on your next step should you now realise that you have not produced effective Contracts of Employment.

For more information on Contracts of Employment, Statement of Terms, or any other Employment related matter please contact Employment Law specialist Beverley Smith at Buckles Solicitors LLP on 01733 888791 or email at beverley.smith@buckles-law.co.uk