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Employment contract - overview
Contracts of employment set out the relationship between an employer and employee. They are made up of various different types of terms. For further information, see Types of contractual term.
Statements of fact made by one party which the other party relies on in deciding whether or not to enter into the contract are called representations. Where they turn out to be untrue, the party relying on the representation has different remedies depending on whether the statement was made deliberately, negligently or innocently. For further information, see Representations, warranties and misrepresentations.
It is difficult for either party to change the terms of a contract once they are agreed, without the consent of the other party. See Changes to contractual terms.
Not all contracts to do work are contracts of employment. Only some workers are employees. The distinction is important in determining which statutory employment rights apply to an individual. For further information, see Continuity of employment.
All employees have a statutory right to be given a written statement containing the key details of their employment terms and conditions. These are normally included in a contract of employment. See Written statement of particulars, and Written statement checklist.
Certain duties apply to all contracts of employment, whether or not the employer and employee want them, such as:
the duty of trust and confidence: see The term of trust and confidence
the duty of fidelity: see The duty of fidelity
For further information, see Duties.
Statute restricts the parties' freedom to agree certain terms, eg:
the contract cannot legally provide for a rate of pay that is less than the National Minimum Wage: see Pay
the hours of work must comply with the Working Time Regulations: see Hours
Any unlawful terms will not be enforceable. See Unlawful terms
Key terms in most employment contracts include:
how the contract can be terminated, how much notice has to be given, and whether the employer can pay in lieu of notice: see Termination clauses
the scope of the employee's duties, and whether the employer has any flexibility to change them in special circumstances: see Duties
how much the employee will be paid, how often, how he will be paid, and when the rate may be increased: see Pay.
the place where the employee will work, and whether the employer has any right to change this: see Place of work
who will own any intellectual property created by the employee during their work. If no agreement is made, the employer will generally own all IP created in the course of employment; any other arrangement needs to be agreed at the beginning of the employment: see Intellectual property
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