Must I give a written contract?

The Equestrian Employers Association(EEA) has an innovative tool called the Contract Creator

The smart online tool is an easy to follow, five-stage process, where you can select options and upload your own company logo to create a Written Statement of Employment Particulars, often referred to as a 'Written Contract'.

The Contract Creator will give you the peace of mind that you are complying with legislation and that your contracts have the most up to date legal details, whilst also including equestrian specific options.

 DISCOVER MORE

“I own and run a small livery yard, employing three grooms. I have never had any issues with my staff and have not issued them with contracts of employment. They have each been with me for at least a year – is this an issue.” name withheld 

In short, yes it is. Nicole Adams from Clarke Willmott LLP explains why :

It’s a legal requirement

Although employers are not legally required to issue staff with a contract of employment, they are legally required to provide them with a written statement of particulars of employment (otherwise known as a “section 1 statement”). A section 1 statement sets out information about the employment relationship, which is usually also included in a contract of employment, and must be issued on the day of or before the employee or worker starts work. 

For example, a section 1 statement includes: the parties names; the start date; the rate and frequency of pay; the days and hours of work; and their holiday and sick pay entitlements etc.

If a statement 1 statement, or document including this information, is not issued, the employee can apply to the Employment Tribunal for a declaration of their written statement of particulars. Also, if the employee later issues and is successful in, for example, an unfair dismissal claim, they can claim up to an additional 8 weeks’ pay as compensation for a failure to provide the section 1 statement.

Verbal vs. written contract of employment

If you have not issued your staff with a written contract of employment, a common misconception is that there is no contract of employment. There is, however, a contract of employment, it is just a verbal one. The problem with this is, if there is ever a dispute about the terms of the contract of employment, there will be no written record.

Protection for the employer

In the absence of a written contract of employment, an employer has to rely upon the limited terms that are implied into all employment relationships for protection. Below are some examples of protection that an employer will not be entitled to in the absence of express written terms:  

• Making deductions from wages – an employer is only allowed to make deductions from wages if it is required by law, they have the contractual right to do so or the employee consents to the deduction. Therefore, if you want to be able to make deductions for overpayments from wages or other sums due, such as the cost of livery or lessons, you should have include a clause to this effect.
• Ensuring confidential information is protected after employment – the implied duty of confidentiality is limited once employment ends - it protects “trade secrets” only (the most confidential information). Therefore, to enhance this, and include other types of confidential information) you need to include a substantial confidential information clause.
• Ensuring that an employee has to give a minimum period of notice so that you have time to find a replacement – in the absence of a contractual notice period, an employee with more than a month’s service is only required to give a week’s notice to leave their employment. If this will leave you short staffed and not enough time to find a replacement, you may wish to have a longer, contractual notice period.
• Recovering the costs of a training course – if you pay for your staff to get their BHS qualifications, for example, they could leave shortly afterwards, taking the benefit of this training with them to a competitor and leaving you with the cost. If you want to be able to deduct the cost of a training course from an employee that leaves, you need to have the contractual right to do so.

 CREATE A CONTRACT