Seven Common Terms of an Employment Contract

Seven Common Terms of an Employment Contract

The common terms you need to include in staff contracts.

By Marcia Smith

All employees have a contract of employment, even if this is only verbal. This contract occurs when the employee agrees to work for the employer, and will set out the employee’s rights and obligations. The most common examples are the right to receive payment and the obligation to follow the employer’s instructions.

Most employees are legally entitled to receive written confirmation of the main terms of their employment contract, which will contain express contractual terms. Common express terms include:

  1. Basic wage an employee will receive
  2. Conditions for any overtime or bonus (if applicable)
  3. Time that the employee must work, which could be in terms of days of the week, hours of the day, or a total number of hours per week
  4. Entitlement to paid holiday
  5. Sick pay
  6. Redundancy pay
  7. Period of notice required by the employer or employee to terminate the employment.

The express terms of an employment contract will all have been explicitly made, but need not necessarily all be contained within the written contract itself. Terms may have been included in the job advertisement or as part of the recruitment process, in an office manual or handbook, or in any documents issued to the employee by the employer. In all these cases, the terms are equally valid.

Statutory terms of employment include the right to receive the national minimum wage, along with the minimum statutory notice period and paid holiday entitlement. Implied terms are those considered too obvious to mention, such as a duty of trust between the employer and employee.