Employment Contract Guide — UK Contracts & the Written Statement of Particulars

As an employer in the UK you must give every employee and worker a written statement of particulars. In practice that means you need a well-drafted employment contract. But what must it contain, and how do the different working arrangements compare? This guide explains the essentials for England and Wales. It is general information, not legal advice.

What is an employment contract?

An employment contract is a legally binding agreement between employer and employee. It sets out the job, pay, hours, holiday, notice and other terms. A contract can exist even where little is written down — but under the Employment Rights Act 1996 the employer must give a written statement of the main terms on or before the first day of work. A full written contract satisfies that duty in a single document, which is why it is the safest approach.

Employee, worker or contractor?

Employment status drives the rights that apply, and the label in the contract is not decisive — what matters is the reality of the relationship.

• Employees have the fullest set of rights, including unfair dismissal protection (after the qualifying period), statutory redundancy pay and family leave. Use a full full-time or part-time contract.
• Workers have a narrower set of rights — the National Minimum Wage, paid holiday and rest breaks — but not unfair dismissal. A casual worker agreement or zero hours contract fits here.
• Self-employed contractors work under a contract for services, not employment. Use an independent contractor agreement — and consider IR35 if working through a personal service company.

Contract types

Permanent contract

The most common form. The employment continues until either party gives notice. It offers the employee the strongest protection, including unfair dismissal rights once the qualifying period of continuous service is met. Use a full-time or part-time contract.

Fixed-term contract

For a project, a maternity cover or a season. A fixed-term contract ends on the agreed date. Fixed-term employees must not be treated less favourably than comparable permanent staff, and successive fixed terms can become permanent after four years’ continuous service.

Flexible and senior roles

For variable hours use the zero hours contract or an agency worker agreement; for trainees an apprenticeship agreement. Senior hires may need a senior executive contract or, for board directors, a directors’ service agreement.

What must the written statement contain?

• Names of employer and employee and the start date (and the date continuous employment began)
• Job title or description of the work
• Pay — amount, how it is calculated and how often it is paid
• Hours of work, including any variable or compulsory hours
• Place of work
• Holiday entitlement — at least 5.6 weeks’ statutory paid leave for full-time staff
• Sick pay and pensions and any other benefits
• Notice periods for both sides
• Probationary period and its conditions
• Disciplinary and grievance procedures and any training entitlement

Probation, notice and restrictive covenants

Probationary periods are commonly three to six months, with a shorter notice period during probation. By statute the minimum notice an employer must give is one week after one month’s service, rising to one week for each complete year up to twelve weeks; the employee must give at least one week once they have a month’s service. The contract can set longer notice. To end the employment by agreement, a settlement agreement records the agreed terms and waives claims (the employee must take independent advice for it to be valid).

A post-termination non-compete or restrictive covenant is only enforceable so far as it goes no wider than necessary to protect a legitimate business interest. Where confidentiality is the concern, an employee confidentiality agreement is often the better tool.

How do you get to a finished contract?

Choose the right type — full-time, part-time, fixed-term or zero hours. Fill in the details of employer and employee and the agreed terms, and you have a clear written contract that also meets your statutory duty.