Three reasons you may not have considered ...
Well written Employment Agreements may save you from employment court!
Every employer is required to have an employment agreement in place for each person employed in their business. In addition to being a legal requirement, the lack of an employment agreement can lead to an array of negative outcomes should you get into a dispute with an employee.
1. Employment Agreements provide protection for your business
It is generally understood that an employment agreement is in place to protect the rights of an employee and avoid exploitation. However, the agreement also provides you, the employer, with a lot of protection for your business. The employment agreement can set out the notice period required so that you aren’t left in the lurch at a critical busy period, and the consequence should the correct period of notice not be given. The agreement can outline how you want confidential information handled - which is vital in an increasingly competitive environment, or the agreement can specify that your employee can’t undertake additional employment that represents a conflict of interest. Make sure your business is adequately protected by getting a proper agreement in place from the outset.
2. Employment Agreements can contribute to higher productivity in your business
Without an employment agreement in place, there can be confusion around how you and your employee will work together, this can lead to a disgruntled and unproductive workforce. If you set out your expectations from the beginning, clearly and in writing, then you start the relationship from a position of trust and transparency.
3. Employment Agreements can help keep you out of the employment courts and minimise costs
The Employment Tribunal take a dim view of an employer where there is not a proper employment agreement in place. Even if you are in the right in a dispute, it will be very difficult to prove this without a written contract. Any award being made against you is likely to be higher without a contract, not to mention the damage to your company’s reputation and your relationship with other employees.
As a starting point on what should be included in your employment agreements, the following is a guide issued by the Citizens Advice Bureau on what your employment agreement must legally cover:
- the names of the parties (the employer and the employee)
- description of the employee’s duties
- the location of work
- the hours of work
- pay details - how much the employee will be paid (must be at least the minimum wage) as well as how, and how frequently they will be paid.
- public holiday entitlements – this must be at least time-and-a-half payment
- how restructuring situations will be handled
- a description of the process for resolving any disputes between the parties, including information about raising a personal grievance