Section 1 of the Employment Rights Act 1996 requires employers to give certain minimum information about their employment in writing to employees.
Many employers often provide this information in a more detailed written contract of employment and refer to a company handbook or other policies or procedures where permitted.
What has led to the changes?
As part of a number of measures published in the Good Work Plan in December 2018, the government committed to providing more clarity about the relationship between employers and workers.
This focus on clarity stems from the government’s desire for workers and employees to have clarity as to what they are signing up to when starting work for an employer.
One of the ways the government is seeking to improve clarity is by increasing the minimum written information that employees should receive about their employment and widening the scope of who should receive this information.
Who do the changes impact?
It will no longer just be employees who are entitled to this right, but workers too.
When do the changes come in?
The changes will affect those who start work on or after 6 April 2020.
There are some limited circumstances where existing employees will be affected by these changes. In addition, existing workers whose contracts terminate and who then start work for you again under a new contract on or after 6 April 2020 will need to be issued with a new form of written statement.
What are the changes?
Additional information- an increased amount of information will need to be given to employees and workers. The government’s aim is that the written statement is as useful as possible.
The additional information is:
- the days of the week the worker is required to work, whether the hours may be variable and how any variation will be determined;
- any paid leave to which the worker is entitled;
- details of any other benefits provided by the employer that are not already included in the statement;
- any probationary period, including any conditions and its duration;
- any training entitlement provided by the employer, any part of that entitlement which the worker is required to complete and any other required training in respect of which the employer will not bear the cost.
No minimum service requirement- previously employees needed to have a job that would last for more than a month before they were entitled to a written statement of employment particulars. This is no longer a requirement for employees or workers.
Single statement- more information will need to be included in the principal statement.
As well as most of the additional information listed above, some information that currently can be provided in a supplemental statement will have to be provided in a principal statement:
- notice periods for termination by either party;
- terms as to the length of temporary and fixed term work; and
- terms relating to work outside of the UK for more than 1 month.
Furthermore, only limited information can be contained in another reasonably accessible document, which must be referred to in the principal statement itself.
Timing of statement- the minimum information must be given on or before the first day of employment (rather than currently within two months of employment starting). This means that it becomes a “day 1” right. Only limited information can be provided after this time.
Why should you comply with the new requirements?
An employee (and worker who starts work on or after 6 April 2020) can make a complaint to an Employment Tribunal where their employer has:
- failed to provide a section 1 statement
- provided an inaccurate or incomplete statement or
- failed to provide notification of the written changes
Where an employee or worker is successful in certain types of employment tribunal proceedings (e.g. unfair dismissal (employees only), discrimination) the employment tribunal must award 2 weeks’ pay and may increase it to 4 weeks’ pay if it considers it just and equitable. A week’s pay for these purposes is subject to the statutory cap, which is currently £525 a week. This means that failure to comply with the requirements could lead to an award against an employer of up to just over £2,000, as well as any legal costs incurred in defending the claim, and any negative publicity that comes with it.
What should you be doing now?
- Review your current practice for issuing written terms- do they need amending to ensure that employees and workers receive their contractual documentation before they start work or at least on their first day?
- Review your contractual documentation- does it cover the information it needs to, not only in terms of the current required minimum information under section 1 but also under the changes? Whilst undertaking that review, now would also be a good time to review your contractual documentation from a best practice point of view.
Take care to ensure that you don’t convert discretionary, non- contractual benefits into contractual benefits when you include details of them.
Prepare different contractual documentation for employees and workers. In addition, the requirement that minimum information needs to be given to workers as well as employees raises questions about how to deal with certain rights that only employees are normally entitled to, such as disciplinary and grievance procedures. Careful drafting will be needed.
- Understand who is an employee or worker- the right extends to workers as well as employees. You will likely be familiar with who is an employee, but the definition of worker is perhaps less well known and is wider than employees. In very basic terms a worker is somebody who has a contract, where the dominant feature is the individual’s personal service and is not carrying out a business/ profession where the employer is the customer/ client.
We would therefore recommend that you review the employment status of those who you are looking to engage. You may also consider it an appropriate time to review the employment status of those who are engaged by you particularly where they are currently classed as self- employed contractors.
We can help you address these issues including by auditing your practices and policies and providing you with clear action so that you can demonstrate compliance in this area. If you are interested in finding out more please contact your usual member of the Brabners Employment team.
This contains a general overview of information only. It does not constitute, and should not be relied upon, as legal advice. You should consult a suitably qualified lawyer on any specific legal problem or matter.
