Louise Skinner: Are your contracts compliant with updates to employment terms?

Louise Skinner: Are your contracts compliant with updates to employment terms

The Good Work Plan, issued in December 2018, brings in reforms to Section One of the Employment Rights Act 1996 (ERA).

These relate to new obligations on employers in the provision of written statements of particulars of employment and adopt many of the recommendations set out in the Taylor Review of 2017. This includes providing individuals with clarity and transparency about their employment and, in particular, their employment rights.

The new rules

Under the new rules, in addition to employees, any ‘workers’ engaged by the employer will be entitled to a written statement setting out the key terms and conditions of their engagement, a Section One statement. This is the first time that a legislative requirement has been introduced to supply workers with written terms.

The right to a Section One statement will become a day-one right (currently employers have two months following commencement of employment to provide the statement to employees), meaning that the employer will be required to provide the Section One statement to the employee or worker before, or on, the day that their employment or engagement commences. Under current law, employees can bring an employment tribunal claim against their employer for a failure to provide a Section One statement, with compensation available (in certain circumstances) of between two and four weeks’ pay, subject to a statutory cap of £538 per week.

Additional information will need to be included in a Section One statement including: the days of the week on which the individual is required to work, including where hours may be variable; any other benefits provided by the employer; any probationary period which starts at the beginning of the engagement; any entitlement to training, including mandatory training; notice periods for termination by either side (not only the employer); andterms as to length of temporary or fixed-term work.

Further information can be provided in a reasonably accessible document, where reference to it is made in the Section OnesStatement, as follows: particulars of any training provided by the employer; and particulars of any other paid leave (other than holiday and sick pay).

Going forward

The new rules will not apply retrospectively to existing employees, so employers will not be required to roll out amended contracts to their current workforce. However, since employers will be under an obligation to provide workers with a Section One statement by no later than the first day of their employment, those firms engaging new workers and/or employees will need to ensure that they have updated their employment contract templates for new joiners.

The new rules also give existing workers the right to request a Section One statement that contains the new information at any time up to three months after the end of their employment. Upon receipt of such a request, employers will have one month to provide a Section One statement that complies with the new rules. Changes to an existing employee’s contract (including any of the additional terms now required) should also be documented in writing.

Where agencies are used by an employer for the provision of staff and such agencies employ individuals directly (and supply them to the employer), while employers may wish to approach agencies to ensure they are taking action, it will be the responsibility of the agency to replicate the new changes in their employment contracts.

Louise Skinner is an employment partner at Morgan Lewis.