An employment contract is an agreement between a business and an employee. As soon as someone accepts a job offer they have an employment contract, so it’s important to make sure everyone’s clear on the terms.
Download our free employment contract template and use it as a guide to create your own depending on what your business needs. Read on to find out more about what to include in an employment contract, and why it’s important when hiring new staff.
Choose to download your Word template now, or get it directly from Farillio’s site where you’ll also get access to their full suite of customisable legal templates.
This document has been produced by Farillio so we can’t take responsibility for its contents. We'd recommend you take professional advice before making any important decisions based on its contents.
When you take on a new member of staff, a contract of employment sets out the agreement between you (the employer) and your employee. It starts when an employee accepts a job offer, and it remains in effect until the contract ends (when an employee or employer gives notice) or until the terms are changed.
Although an employment contract usually doesn’t need to be in writing for it to be legally valid, it’s advisable to put something down on paper. Employment dispute body ACAS says that simple misunderstandings over what is or isn’t in a contract are amongst the main causes of employment tribunal claims.
It’s important to note that most employees are legally entitled to a written statement of the main terms and conditions of their employment within two months of starting their job. This is likely to overlap with the contents of the contract, as it must include details of things like pay, holidays, and working hours.
An employment contract makes an agreement between you/your company and your employee. It should include an employee’s:
The Farillio template is intended as a guide that you can edit and tailor to your business needs. It provides sample wording to help you set out things like:
This template also includes a suggested outline for describing notice periods, hours of work, salary, performance reviews, holidays, sick pay, pension arrangements, retirement, and other important employment terms.
Where more detailed information is provided in a company policy, rather than the contract itself, the template gives you the option to insert the relevant policy name or refer to the company handbook (if you have one).
This template is fully customisable and there are gaps for you to add in the employee’s job title, your company name and address, and the employment and probation dates.
For some sections of the employment contract – for example those that deal with pension arrangements and notice periods – you’ll need to choose the paragraph that describes your company’s approach, and delete the other sections.
It’s important that you check the template carefully, making sure it applies to your organisation and the relationship you’re forming with your employee. You’ll need to edit the template as necessary, but at every stage you should make sure you’re complying with employment law and workplace regulations. Seek help from an employment law specialist if you need it.
You and the employee both need to sign the contract of employment, and you should give the employee a copy to keep, and keep a second copy for your business records.
Farillio provides legal tools and templates designed with small businesses and the self-employed in mind. Using their employment contract template will help you meet your legal responsibilities and take ownership of your company’s journey.
Our partnership with them lets us bring you quality, relevant legal documentation for your small business. Here are some other templates from Farillio that you might find useful:
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