Employment Contract

Archive for December, 2010

The True Cost of Employment Contracts

December 29th, 2010

By law, an employee is entitled to a written statement of the main terms of their contract within two months of employment, which must include:

Pay Hours of work Holiday entitlement Sick pay arrangements Notice periods Information about disciplinary and grievance procedures

Because the contract is a legal document, it must hold the correct information, written properly and sensibly in a manner that protects both the employer and the employee.

But how do you write employment contracts without the legal knowledge?

Contact a lawyer

If you are not legally trained, or have little experience of drafting employment contracts, it would be prudent to seek legal advice.

A law firm will be able to draw up a contract to use company wide, but unfortunately at a cost, generally at hourly fees of between ?160 and ?250. For small businesses, this can be a cost which is simply not a viable option.

Contract Templates

A template is a standard document which allows you to fill in all the appropriate details of your company, employee and terms of conditions. Whilst relatively cheap, they can include masses of generic information about employment law and data which may or may not apply to your business, which will be need to be interpreted before it can be used as a legal document.

Once this has happened, chances are you will need to amend, add or remove clauses to make the document relevant for your business or situation. And so now you have a dilemma: you think you have a legally binding and compliant contract, but because you’ve made changes to the original – generic – data, you cannot be absolutely certain that should something unexpected happen, you, your employees or your business are protected according to the law.

This leads us back to legal advice, which as well as the above costs, a solicitor would need to read the contract and prepare some notes, generally taking half to three quarters of an hour. Meaning additional fees of – at least – ?80 to ?125, and at this stage – you still do not have a legally compliant employment contract.

Suddenly, your ?45 template is starting to look expensive, and time consuming.

Templates usually appear straight forward and you may feel as if you’re getting real value for money by purchasing one, and reusing it. However, using a template to create compliant employment contracts in England and Wales assumes that you have had legal training, or are very experienced, have a healthy HR budget, and that you have spare time on your hands.

Understanding the true cost of the template-to-compliant-employment-contract journey is a difficult one to call. It could be that the changes you made in the original document require only minimum redrafting, and that your legal bill is under ?250 per contract. Alternatively, you could be really unlucky and end up with fees double or even triple that amount – per contract.

Pay As You Go

In recent times, another service has opened to many UK small to medium sized businesses which is somewhere between the above two options.

Employees are now able to buy employment contract templates which have been signed off and backed by professional law firms that allows you to create a contract personalised to your businesses needs and to a specific employee.? Based on your responses to a straight forward set of questions the system understands which clauses are required in the document and inserts the necessary text to complete the contract.

Whilst these employment contracts do cost more than a standard template (?100-?200), because they have been signed off by a legal team, you can have complete peace of mind that your contracts adhere to current UK law which protects your business, and your biggest assets, your employees.

When choosing an employment contract document provider, look out for:

Are you tied into a contract? There are some businesses who will tie you into a binding and expensive software agreement. Always check the terms and conditions thoroughly before procuring the service Will you receive updates? Employment law is an ever changing thing, and employment contracts can quickly become out of date. Ensure that whichever option you choose, you receive updates as to the change and what they mean (obviously this is better if it is free). Also do they provide you with free legal advice for those factors which you don’t understand? How legal are the legal documents? For the documents to be real they will need to be backed and signed off by an actual legal team or firm. Don’t be rest assured by just being told that they are, find out who they are backed by and research them thoroughly.
Which way to go?

The option a business chooses will always depend on the business itself. Whichever way you decide always make sure that your employment contracts remain legal, so you protect your business and your most important assets, your employees.

By: Frances Critchlow

About the Author:

Frances Critchlow works for Cleardocs, an online provider of bespoke, legal employment contracts to businesses in England and Wales. We work with small to medium sized businesses (SME), accountants, law firms, recruitment agencies and business consultants.

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Tags: Option Contract

Employee Rights – Contracts, Minimum Wage and Pay Slips

December 29th, 2010

When you start a new job, your employer may wish to carry out a certain amount of checks depending upon the type of job you are going to do. These checks can be document checks, references, background checks, equal opportunities monitoring, health checks, educational qualification and criminal record checks. If the results of these checks are found to be unsatisfactory, the employer can anytime withdraw the job offer given to you even after you have accepted their offer.

An employment contract is mandatory between employees and their employer, although it is not always in writing. If there is no written contract, then a statutory employment contract will automatically come into effect when you start working for the employer.

You should be aware of the employment contract terms so that you can be aware of your employment rights. The national minimum wage (NMW) is the minimum amount which most of workers are entitled to get paid for every 1 hour they work. If you are being under paid then you should get advice from the government pay and work rights helpline. Depending upon the age or if you are working as apprentice, there are different levels of national minimum wage. You are not entitled to the national minimum wage if you are not of compulsory school age (although this is obviously very young).

You have the right to know how much you will be paid and how frequently you will be paid. You are also entitled to receive a detailed individual written statement from your employer at the time when you are paid, or shortly before. You will receive a pay slip only if you are an employee, and not if you are a freelancer, contractor or a member of the police. Your pay slip should contain certain mandatory details like your gross wages, any fixed deductions, variable deductions like tax, your net payable wages after all the deductions, method of calculation and the amount for any part-payment of your wages.

You can work on an average for 48 hours per week unless you are working in a sector which has its own set of rules. Your normal working hours should be mentioned in your employment contract or employment particulars. All employees are entitled to a minimum of 5.6 weeks paid annual leave but the employer may offer more. On average an employee in the UK is entitled to 5.5 days a year of sick leave.

By: Claire Jarrett

About the Author:

We recommend 11 Stone Buildings who are Employment Lawyers in the UK.

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Tags: Mandatory Details

Verbal Employment Contract – For The Teenagers

December 28th, 2010

There are numerous employment opportunities and career choices out there that an individual can choose from. Be it a writer, a scientist, a chef, a landscape artist or an interior designer. When you are in your teen and just starting your work life, you will not have the privilege of big sounding tittles. You will mostly be laboring under these people as a hired worker at the very bottom of the pecking order. The best example is that a lot of teenager this days get jobs as apprentices for landscaping artists. Their tasks mostly involve running the mowing machine and trimmer for them.

In such circumstances, the work is normally very relaxed and the manager or management has full trust in you that you will meet your obligations as required. This trust mostly leads to a verbal employment contract for some type of jobs. Majority of firms employ the use of paper employment contracts you have to sign. They normally cite the possibility of misunderstandings at some later stage as the major reason for that and their dislike of verbal employment contracts. Verbal employment contracts can never be proved later, and that makes it only applicable to smaller firms and in not very essential jobs. Such jobs may not require the employer to have long term workers. You may enjoy lawn mowing during summer, but then you may not have the desire of doing it in long term basis. Employers know this, and that makes them use verbal employment contracts to simplify the hiring process.

There are some factors that an employee should be concerned about, though. Suppose you begin work with a larger firm, like a fast food franchise or some other type of company, you may need to sign a regular employment contract. You should be wary if they don’t provide one. There are managers in certain firms who overlook regular contracts and employ verbal employment contracts instead. They do this to take advantage of their employees. If you smell a rat, then better request some form that you could sign. If that doesn’t help much, then you are better of in another kind of employment. Think about this; a signed employment contract will not only protect the firm, but it safeguards your rights as well. You should only accept verbal employment contract from small firms that are independently owned and that you have confidence with. This will greatly save you trouble and some potential lawsuits too.

Should all go well, your chosen situation will determine whether you have a good and secure employment at your initial job as a mature adult or not. Always remember that you are entitled to your rights and they should not be played with at any cost.

By: Abhishek Agarwal

About the Author:

Abhishek is a Career Counselor and he has got some great Career Planning Secrets up his sleeves! Download his FREE 71 Pages Ebook, “Career Planning Made Easy!” from his website http://www.Career-Guru.com/769/index.htm. Only limited Free Copies available.