Following the publication of the government’s Good Work Plan in December 2018, legislation will be coming into force imminently that will affect the contractual terms and conditions businesses must provide to their staff.
Employees are currently entitled to receive a written statement of their key terms of employment within 2 months of starting work and in most cases this information is contained within their contract of employment.
From 6 April 2020, there are additional requirements to be met in order to remain compliant with the legislation. The key changes are:
- Extension to “workers”
The right to receive a written statement of particulars has previously only applied to “employees” and will now be extended to” workers”.
Workers contract to personally provide work or services to another party and tend to operate more flexibly than employees but do not have the same independence as fully self-employed contractors. They are to some extent a hybrid between the two.
- ‘Day one’ right
At present employees must be employed for one month to be entitled to receive this information but going forward there will be no length of service requirement and the written statement of terms must be provided on or before the start date of the employee/worker.
There are however some details that can still be provided within the first two months, including information on pensions, training entitlement, collective agreements and disciplinary and grievance procedures.
- Additional Provisions to be included
For those starting work on or after 6 April 2020, their contract of employment (or statement of terms) must contain the following additional particulars:
- details of any probationary period, including the length and any conditions;
- the days of the week the individual is required to work, whether the days and working hours may be variable, and details of how such variation will be determined;
- any paid leave entitlement for employees, such as statutory family leave, parental bereavement leave or other compassionate leave, paid sabbaticals or career breaks. Workers are not entitled to paid statutory leave unless the company offers contractual entitlements and if so, these will need to be included.;
- details of all benefits which have some economic value (e.g. vouchers, season ticket loans, etc); and
- any training entitlement including whether any training is compulsory and whether it must be funded by the individual.
- Separate documents
Whilst the majority of terms must be contained within a single document (usually the contract of employment), certain details may be specified in a separate policy referred to in the contract or statement of particulars.
The types of information which can be contained in a separate document/policy include details regarding:
- incapacity and sick pay;
- paid leave;
- pensions terms;
- any non-compulsory training entitlement which the individual does not have to pay for;
- disciplinary and grievance procedures (in addition to that set out in the statement of particulars); and
- collective agreements.
The changes are not retrospective, and so existing contracts will not have to be replaced or amended although current employees will be entitled to request an up to date statement of terms.
The rationale behind the changes is to provide clarity of information and rights to workers and employees from the outset of their working relationship. The upcoming changes therefore present the perfect opportunity to review employment contracts to ensure that they are up to date and fully compliant. Businesses should also draft a separate statement of particulars for workers having not had to do so previously.