Self Help Guide - Producing a Written Statement

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1 Self Help Guide - Producing a Written Statement This guide gives general advice about written statements of particulars of employment only. The information given in this guide is not an authoritative interpretation of the law. Such an interpretation can be given only by the employment tribunals and by the courts. WHAT is a contract of employment? It is a legally binding agreement between employer and employee which is formed when an employee agrees to work for an employer in return for pay. It may be made orally, but should be in writing to avoid dispute. You are legally required to put some of the main particulars of employment in writing. WHAT is a written statement? It is a summary in writing of an employee s main particulars of employment. It is not itself a contract of employment but is evidence of the contract of employment. WHY produce a written statement? Because you are required by law to give written statements to all employees who have been in your employment for at least one month. Incomplete or inaccurate written particulars of employment can result in increased compensation being awarded at an employment tribunal in the event of a successful separate claim. It helps to avoid misunderstanding and disputes about employees particulars of employment. Written statements should be given to all employees. WHO is not entitled to a written statement? Anyone who is not an employee, for example an independent contractor or freelance agent. Certain mariners and employees who ordinarily work outside Great Britain. HOW? Keep it simple Write straightforward English and don t use jargon or legalistic language. This leaflet gives you further general guidance on how to draw up a written statement.

2 Tailor it to your own needs The sample of a written statement given in this guide is only an example which should be adapted to suit your own organisation. Refer employees to other documents where permitted The law allows you to refer employees to other documents for information on: sickness provisions, pensions, notice periods (but only collective agreements or legislation) and certain disciplinary/grievance matters. All other information on the employment particulars must be included in the written statement and, in practice, it is usually better in a smaller company to put all information in one document. Seek advice This guide should enable you to produce a first draft of a written statement. It is a good idea to show the draft to someone else for comment. Acas can help with this. It is always best to consult directly with employees and their representatives. WHEN? You are required by law to give employees their written statements within two months of the start of their employment ideally on their first day. You may provide the written statement in the form of a letter of engagement and/or a written contract before the employee begins work. Go through the statement with employees to clarify any points and to answer any queries they may have about their employment. The law allows you to issue the written statement in instalments, but certain key information must be included in the principal statement which must be included in a single document. These items are: name of employer and employee date employment and continuous employment began job location pay working hours holiday entitlements and job description/job title details of any collective agreements that directly affect the employee s conditions of employment. The remaining information can be given in other instalments, but all the instalments must be given to the employee within two months of the date of starting work. However, it will avoid confusion if you issue all the required information in one package. Where an employee is required to work outside the UK for more than one month within the two-month period, they must be given the statement before they leave the UK. What about changes to the written statement? Changing a contract can have complex legal implications if not handled properly. These are some key points to remember. At common law a

3 contract can be changed only by mutual consent. Terms in individual employment contracts can be changed validly in the following ways: the employer and employee may agree on the change the contract may provide for changes. For example, a contractual mobility clause will allow an employer to move an employee from one workplace to another as long as the employer acts reasonably in doing so individual contracts may be varied by a union agreement which is binding on individual employees the employer may, by giving the proper period of notice, terminate the existing contract and substitute a new one. However, the employer should be aware that the employee could make a claim of unfair dismissal. If you are preparing written statements for existing employees, you are not entitled to change the present terms. These may have arisen from appointment letters, old statements, custom or practice and the new written statement should incorporate these. If there are any agreed alterations to an employee s terms and conditions after the statement has been issued, you must give the employee a written notification giving details of the changes as soon as possible and in any event within one month of the changes taking place. Written notification must be issued on every occasion there is a change in terms and conditions. Further information Further information on this subject is available in other Acas Publications for more details and also from the DTI web-based publications Written statement of employment particulars (PL700) and Continuous employment and a week s pay: rules for calculation (PL711). Example of a written statement All these items must be included by law, except for optional extras which are printed here in italics. *Name of employer.. *Name of employee.. *1. Commencement of Employment and Continuous Employment Your employment with this Company began on.. Your previous employment with does/does not count as part of your continuous period of employment.

4 *2. Job Title You are employed as a. *3. Job Description *4. Job Location *5. Pay Your rate of pay is You are paid at intervals... Other pay information. *6. Hours of work Your hours of work are *7. Holidays Your holiday entitlement is. You holilday pay is. Your holiday year begins on You are entitled to the following public holidays. #8. Sickness absence Your sick pay entitlement is.

5 Your rate of payment is The notification and evidence rules are days, you must get a medical certificate. For shorter periods you must fill in a self-certification form. 9. Absence from work If for any reason you cannot come to work, you should telephone us as soon as possible on the first day of your absence by (time) and speak to.... (outline the job title of the person who should be contacted). #10. Pension Scheme The Company does/does not operate a pension scheme. A pensions contracting out certificate is/is not in force for your employment with us. The details of the Company pension scheme are as follows:.... #11. Ending the employment Your contract is for an indefinite period but subject to notice. After one month you must give one week s notice to terminate your employment. After one month you are entitled to one week s notice for the first two years in your job, and after that you get an extra week for each year up to a maximum of 12 weeks after 12 years. For example: Length of service More than one month but less than 2 years More than 2 years but less than 3 years More than 3 years but less than 4 years and so on with an extra week for each year until More than 12 years Notice 1 week 2 weeks 3 weeks 12 weeks OR Your employment contract is for a fixed-term and expires on:

6 OR Your employment is temporary and is expected to continue for: (You should indicate only the likely duration of the employment) #12. Disciplinary Rules Include disciplinary rules here. 13. Disciplinary Procedure Example of a contractual disciplinary procedure 1) Purpose and scope The Company s aim is to encourage improvement in individual conduct. This procedure sets out the action which will be taken when disciplinary rules are breached. 2) Principles a) The procedure is designed to establish the facts quickly and to deal consistently with disciplinary issues. No disciplinary action will be taken until the matter has been fully investigated. b) At every stage you will have the opportunity to state your case and be accompanied, if you wish, at the hearings by a shop steward if appropriate, or by a fellow employee. c) You have the right to appeal against any disciplinary penalty. 3) The Procedure Stage 1 First written warning If your conduct or performance is unsatisfactory, you will be given a First Written Warning. The warning will be disregarded after months satisfactory service. Stage 2 Final written warning If your conduct or performance is still unsatisfactory, a Final Written Warning will be given making it clear that any recurrence of the offence or other serious misconduct within a period of months will result in dismissal. Stage 3 Dismissal If there is no satisfactory improvement or if further serious misconduct occurs, you will be DISMISSED. You will receive a written statement setting out why the company has decided to take disciplinary action. You will attend a meeting at which you may be accompanied. You will be given the right to appeal against the Company s decision.

7 4) Gross misconduct If, after, investigation, it is confirmed that you have committed one of the following offences (the list is not exhaustive), you will normally be dismissed: theft damage to company property fraud incapacity for work due to being under the influence of alcohol or illegal drugs physical assault gross insubordination. While alleged gross misconduct is being investigated, you may be suspended, during which time the normal hourly rate will be paid. Any decision to dismiss will be taken by your employer only after a full investigation. 5) Appeals If you wish to appeal against any disciplinary decision, you must do so within five working days. Your employer will hear the appeal and decide the case as impartially as possible. If you are dissatisfied about any disciplinary decision that affects you please contact. (name of person). #14. Grievances If you have a grievance concerning your employment, please contact 15. Grievance procedure Example of a grievance procedure It is Company policy to ensure that any employee with a grievance has access to a procedure which can lead to a speedy resolution of the grievance in a fair manner. Stage 1 If you have a grievance about your employment, you should first raise it orally with your immediate supervisor, who should give you a reply within two working days. Stage 2 If the reply given at stage 1 does not satisfactorily resolve the grievance,

8 you should detail the grievance in writing. The written grievance will then be submitted to the office manager. Stage 3 If the matter is not resolved satisfactorily within five working days, you may elect to appeal to the managing director, who will give a decision within five working days. This decision will be final. 16. I acknowledge receipt of my particulars of employment Signed Date. Guidance notes Items marked * must be included in a single document the principal statement. If there is no provision for any of the items which must be included, this must be made clear. For instance, in item 5 on Pay, if there is no overtime rate payable, then the written statement should say so. Other items can be provided either in the principal statement or in other instalments. For items marked #, the employee can be referred to other documents accompanying either the principal statement or in instalments which must be given to the employee within two months of the date of starting work. *1. Continuous Employment A number of statutory employment rights depend upon the employee having a certain period of continuous employment. A period of employment counts towards the employee s continuous service only if it is unbroken. Work with a previous employer may sometimes count towards the employee s continuous service. This will usually be the case where there has been a merger or takeover of your old company. The rules on this are not simple and if in doubt you should seek advice from your local Acas office or a lawyer. *2. and 3. Job Title and Job Description The law requires you to include a brief description of the work involved or a job title. It is important that the employee understands the range of duties to be reasonably undertaken. This is particularly important where flexible working practices have been introduced.

9 Where the employee is required to work outside the United Kingdom for a period of more than one month, you must outline in the written statement: the period for which the employee is to work outside the UK the currency in which the employee is to be paid any additional remuneration any terms and conditions relating to the employee s return to the UK. *4. Job Location Whether or not you can insist on the employee s mobility will depend on the terms of the contract. To avoid confusion it is best to put any mobility terms in writing. You should state the precise location of the job. You should outline clearly the extent of mobility required whether the employee is required to work at more than one location in an area, or anywhere in the UK, or in posts overseas. *5. Pay Provide employees with clear, comprehensive information about their pay and other benefits because misunderstanding about pay generates mistrust and suspicion. If it is appropriate to your organisation, you should include the following information on the written statement: details of bonus schemes overtime rates and when they apply details of other benefits such as luncheon vouchers deductions from pay methods of payment standby arrangements and payments. It is also useful to give details of any other benefits you provide such as: allowances for clothing or travel company cars/vehicles. *6. Hours of Work Any terms and conditions relating to normal working hours should be included. Describe any arrangements for flexibility in hours of work. Where appropriate outline arrangements for shift working or flexitime. Outline any special arrangements for part-time workers. State whether overtime is voluntary, compulsory or guaranteed and how much notice of overtime will be given. Under the Working Time Regulations an employer is required to take all reasonable steps to ensure that workers do not work more than an average of 48 hours a week over a 17-week period. However, individual workers may choose to agree to work more than the 48-hour average

10 weekly limit. If they do so, the agreement must be in writing and must allow the worker to bring the agreement to an end. A worker is also entitled to a rest period of 11 consecutive hours between each working day; to an uninterrupted rest period of not less than 24 hours in each seven-day period and to an uninterrupted break of 20 minutes when daily working time is more than six hours. Young workers, those between 16-17, are subject to different rules. Night Work: Employers are required to take all reasonable steps to ensure that the normal hours of their night workers do not exceed an average of eight hours for each 24 hours over a 17-week period. The average period may be extended in certain circumstances. Guidance on the Working Time Regulations is available on the Department of Trade and Industry s website at *7. Holidays Under the Working Time Regulations 1988 a worker is entitled to at least four weeks paid leave each year. If you wish to offer the employee longer holidays than the minimum entitlement, then it is a matter for negotiation between you and the employee or employee representatives. The law requires particulars of all terms and conditions relating to holiday entitlement, including public holidays and holiday pay to be included in the written statement. The particulars should be sufficient to enable the employee s entitlement, including any entitlement to accrued holiday pay on termination, to be precisely calculated. For example, if appropriate, the statement should include particulars relating to: how holiday pay is calculated, ie: does it include commission, shift allowances, overtime pay? how holiday pay is accrued (including for part-timers). It is also useful to include information on: restrictions on when holidays may be taken methods of resolving disputes about when holidays may be taken details of annual shutdowns carrying forward holidays not taken into the next holiday year. #8. Sickness absence This is one of the four areas where you can refer employees to other documents. You should ensure that the employee has reasonable access to the document, whether it be a staff handbook or some other form. Copies could be put on noticeboards or made available in rooms to which employees have easy access or, attached to the statement itself. It is advisable to explain not only when the employee is entitled to sick pay but

11 also details of any conditions attached to it such as length of service, waiting days and Statutory Sick Pay (SSP), how long it lasts and what happens if employees are sick during a holiday. 9. Absence from work You are not required by law to include this section. However, this issue often causes problems so it is important to make it clear to employees that they should contact a particular person (normally their line manager) as soon as possible on their first day of absence (for whatever reason). #10. Pension Scheme Employers with five or more employees who do not operate a pension scheme are required to provide access to a stakeholder pension scheme. They must: name a stakeholder provider provide information to employees offer a pay roll deduction facility for employee contributions enable staff to join the scheme within three months of starting their job. Firms and individuals (such as trustees) are liable to fines for noncompliance. Where there is a scheme, the rules and regulations are usually too complex to be contained in full in written statements. This is another instance where the law allows you to refer the employee to another document, such as a leaflet or a company handbook, for comprehensive information on your pension scheme. However, you could if you wish include brief details in the written statement, covering such aspects as: how the pension is calculated whether the scheme is voluntary or compulsory whether the scheme is contributory or non-contributory the qualifications for joining the scheme (which should not be directly or indirectly discriminatory) whether the company has contracted in or out of the state pension scheme. #11. Ending the employment There should be provision for reasonable notice on either side to terminate the contract. The periods of notice that are shown on the opposite page are the minimum periods required by law. If you wish to increase the periods of notice required by you, then you must obtain the agreement of the employee. As an alternative to including details of notice requirements in the written statement, the law allows you to refer the employee to the

12 legislation or to any collective agreement which directly affects the terms and conditions of the employment. Employees must have reasonable access to copies of the relevant collective agreement, but you are not required by law to make available copies of relevant employment legislation. Where the employment is not intended to be permanent, you should state on the written statement when it is expected to end. If the contract is for a fixed period, you should state the date when it is expected to end. All employers must have minimum disciplinary and dismissal procedures (DDP) which they must follow otherwise a dismissal will be automatically unfair. Standard DDP or Modified DDP You should not use the statutory three-step discipline and dismissal procedure in the early stage of disciplinary action for alleged minor offences. For example, if an employee is persistently late and you wish to initiate formal disciplinary action, you should give the employee a first written warning. You should only use the three-step procedure when you are considering taking serious disciplinary action, such as dismissal, suspension without pay, or demotion. Therefore, you will use the threestep procedure if an employee s conduct or performance has failed to improve following a series of warnings or if the employee has allegedly committed an act of gross misconduct. The modified statutory discipline and dismissal procedure is a two-step procedure. In Step 1, you write to the employee setting out the reasons for dismissal and give the employee the right of appeal. Step 2 will be set in motion if the employee wishes to meet you to appeal against the dismissal. The modified two-step procedure should be used only in a very small number of gross misconduct cases where the employee s conduct would justify summary dismissal.

13 #12. Statutory Disciplinary and Dismissal Procedures Step 1 statement of grounds for action and invitation to meeting the employer needs to put in writing the employee s alleged conduct or other circumstances which led the employer to consider dismissing or taking disciplinary action against the employee the employer needs to send this statement or a copy of it to the employee and invite the employee to a meeting to discuss the matter. Step 2 meeting the meeting must take place before action is taken (except suspension of the employee) the meeting should not take place unless (i) the employee has been told by the employer the basis for his statement outlined in step 1, and (ii) the employee has had a reasonable opportunity to consider a response the employee must take all reasonable steps to attend the meeting the employer must inform the employee of his/her decision after the meeting and explain how to appeal if the employee is not satisfied with it. Step 3 appeal the employee must inform the employer if s/he wishes to appeal in the event of a wish to appeal, the employer must invite the employee to a further meeting the employee must take all reasonable steps to attend the meeting the appeal meeting does not have to take place before the disciplinary or dismissal action takes effect the employee must be informed, after the appeal, of the final decision the employee has a right to be accompanied to meetings by a colleague or a trade union representative.

14 13. Disciplinary procedure You are required by law to have a disciplinary procedure. The example of a disciplinary procedure which is given in the Written Statement is only an example which may be adapted to suit the needs of your own organisation. If you ask your workers to attend certain grievance and disciplinary hearings they have a statutory right (if they request) to be accompanied by a fellow worker or trade union official. This right applies irrespective of how many workers you employ. If you refuse a request from a worker to be accompanied at a disciplinary or grievance hearing the worker may make a complaint to an employment tribunal. #14. and 15. Grievances The Employment Act 2002 requires employers to have a grievance procedure. The statutory grievance procedure How do the statutory grievance procedures operate? In Step 1 - the employee sets out in writing his or her grievance with the employer. In Step 2 - the employer arranges a meeting to discuss the employee s grievance. The employee has the right to be accompanied. At the end of the meeting, the employer informs the employee of the decision and the employee s right of appeal. In Step 3 - the employee tells the employer if he or she wishes to appeal. If an appeal is requested, a further meeting is arranged, if possible with a more senior or different manager. The employee has the right to be accompanied. At the appeal meeting the employee is told of the employer s decision. The law allows you to refer employees to a separate document which is readily available and which should provide them with more information about the grievance procedure. A grievance procedure can be of mutual benefit to both employer and employees because it can provide an open and fair way for employees to make known their complaints and it can help to resolve grievances quickly before they fester and become major problems. At the appeals stage in the grievance procedure, it is good practice to have the appeals heard by someone who was not involved in dealing with the issue concerned. Workers have a statutory right to be accompanied at certain grievance hearings.

15 The example of a grievance procedure which is given in the Written Statement is only an example which may be adapted to suit the needs of your organisation. 16. Employee s signature There is no legal requirement that an employee should sign his or her written statement. However, employees who are asked to sign the statement are probably more likely to have read and questioned its contents and there is less likelihood of future disputes over the terms of these particulars of employment. You can ask for acknowledgement of receipt, which just records that the employee received the document, or you can ask for confirmation that it is correct. You should not, however, put undue pressure on employees to accept what may be your view of the particulars and not theirs. 17. Examples of other items that could be included in the written statement: appraisal arrangements training and staff development time-off arrangements trade union membership health and safety matters lay-offs and short-time working maternity/paternity and working parent policies redundancy policy suggestion schemes company vehicles staff purchase expenses outside interests other employment right to search smoking policy plant and tools restraints following termination changes to terms and conditions of (restrictive covenants) employment the use of mobile phones the use of computer facilities including the internet and . Alternatively, this additional information may be included in a company handbook. Legal information is provided for guidance only and should not be regarded as an authoritative statement of the law, which can only be made by reference to the particular circumstances which apply. It may, therefore, be wise to seek legal advice. Last printed version: November 2004 Last updated web version: January 2005

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