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Help for small firms

The new employee's contract: A step-by-step guide

The new employee's contract - Be prepared

Know the basics and comply with the law

  • Tell the new employee the key terms of their employment - job title, pay and any benefits, hours, place of work, start date and any probationary period. This can be done orally, in writing, or through a mixture of the two. However, it is best to give the employee the terms in writing before they start work to avoid disagreements.
  • Remember, a contract of employment starts as soon as they accept your job offer, although it is common for it to be subject to satisfactory references.
  • Within two months of their start date, you must give the new employee their terms and conditions of employment in a Written Statement of Terms and Conditions of Employment.
  • Later, changes to their terms can be made, but only if employer and employee agree, or if there is a clause in the original terms which cover the alteration.

The contract of employment is made up of:

  • your job offer
  • the Written Statement of Terms and Conditions of Employment
  • the company procedures, policies and documents referred to in the statement - for example, your disciplinary and grievance procedures
  • employment laws, such as those relating to maternity rights, unfair dismissal and annual leave
  • some rules which are too obvious to be written into the statement. For example, an employee will not steal from their employer.
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