22 January 2020

Are your employment contract templates up to date?

Employers are required by law to provide their employees with certain information in writing relating to their terms of employment. This is technically known as a “section 1 statement” (“statement”), and is normally contained within the employment contract. Following the Government’s Good Work Plan, which was published in 2018, the information that employers need to provide is changing with effect from 6 April 2020. The changes will apply to all new recruits starting on or after this date; existing employees can also request this information, and if such a request is made, he/she needs to be provided with an updated statement within 1 month.

The changes are likely to have a significant impact in the hotel sector given the atypical employment arrangements that many hotels operate (e.g. flexible hours).

The key changes include:-

  • Statements will need to contain additional information, such as:-
    • further detail around working hours, especially where hours are flexible;
    • specific mention of probationary periods;
    • further detail around paid leave (e.g. maternity leave and paternity leave), remuneration and other benefits; and
    • details of any entitlement to training (and who is responsible for the cost).
  • Employers will need to provide a statement to “workers” as well as employees. (The current regime only applies to employees.) With increasing uncertainty around worker status in light of recent cases (especially in the gig-economy), this will be a challenge for employers. It is important that employer’s differentiate between the two groups as the terms of the statement will be different (e.g. workers are not typically subject to probationary periods or to an organisation’s disciplinary procedure).
  • With a few exceptions, employers need to provide a statement to employees in a single document on their first day of employment. (Under the current regime, employers can provide the information within 2 months of an employee’s start date.)

Failure to provide a compliant statement can give rise to a standalone claim (where an individual brings another claim in the Employment Tribunal), which is currently capped at £2,100 (4 weeks’ “basic” pay).

Employers should ensure that they have systems in place to identify “workers” (so that workers as well as employees receive a compliant statement) and review their template documents to ensure that they comply with the new changes.

Please contact our employment law specialists, Joe Beeston (Senior Associate) and Rosie Moore (Associate) if you have any questions.

Joe Beeston is a Senior Associate in our Employment team and Hotels group.

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