There are still a frightening amount of small businesses who are not aware of the changes in legislation, long gone are the days when small businesses could avoid challenges from employees due to them employing less than 5 people. Under current legislation, whether you employ 1 person or 500 people, the same regulations apply.
The Employment Act 2002 (S.36) removed the small business exemption regarding employment legislation covered in the Act.
This not only refers to Statements of Written Particulars (which could be defined as a Contracts of Employment) but the removal on the exemption also affects other employment areas, such as following statutory discipline & grievance procedures. In addition, the exemption for small businesses was removed from the Disability Discrimination Act in 2004, meaning that employees with less than 5 staff also need to make any reasonable adjustments for a disabled employee.
One of the main areas for concern is the Contract of Employment, or Statement of Written Particulars. All new employees whose employment continues for one month or more are entitled to receive a written statement of particulars of employment specifying certain employment details. The employer must provide the statement not later than 2 months after the employee starts work.
Details should include: the names of the employer and employee, the date employment began and any details of continuous employment, the rate of pay and payment details, hours of work, holiday entitlement, job title & a brief description of duties, any details of sick pay, collective agreements, and a number of other details.
Although the Act does not clearly define the penalty for not supplying the statement of written particulars, the penalty is described as ‘undefined & unlimited’. In reality, you are unlikely to be taken to tribunal for the lack of a statement, but the lack of one would attract a greater award if there is ever a tribunal.
Not only to keep in line with legislation, issuing an employment contract clearly outlines the employment relationship for both the employer and the employee. It creates a professional start to the relationship and takes away any uncertainty as the details under which a person is employed. At present times more than ever we are looking to find and retain the best employees to keep our businesses strong and gain competitive edge. The Employment Contract is an early part of this process and its value should not be overlooked.
Have you reviewed your Contracts of Employment recently, or do you need a new contract written? Our Director of HR Services, Joanne Vose, offers a free consultation to help you get on track. Call her today on 0113 239 5673 or email joanne.vose@hrconnexions.co.uk
