By Nic Hart & Liam Hutton
11.01.2020
Because of the Governments Good Work Plan, there are some important changes to the obligations on employers on issuing a written statement of particulars of employment, referred to as the ‘Section 1 Statement’. Employers currently often ignore that section.
Below is some advice that we recommend to include in offer letters to avoid confusion and dispute further down the line.
The ‘Section 1 Statement’ – Current Position
Employers are currently obliged to provide employees whose employment is to continue for more than one month with a written statement of certain terms of their employment. This is often referred to as a ‘Section 1 Statement’ by virtue of the fact that such right is guaranteed by section 1 of the Employment Rights Act 1996.
By way of reminder, these include but are not limited to:
- The date the employment starts and the date the employee’s period of continuous employment began;
- Pay (or method of calculating it) and interval of payment;
- Hours of work, including normal working hours;
- Holiday entitlement and holiday pay;
- The employee’s job title or a brief description of the work;
- Place of work;
- Terms and conditions relating to incapacity for work due to sickness or injury;
- Provisions relating to termination;
The current position also allows employers two months to provide the above information to employees entitled to receive a written statement.
The ‘Section 1 Statement’ – Changes Coming into Effect 6 April 2020
The Government’s Good Work Plan will effect changes to the current position, which come into force on 6 April 2020.
The main points to be aware of are as follows:
- The obligation on employers to provide a written statement of particulars will be extended to workers, as well as employees. This is likely to extend the number of people working for organisations who are entitled to such a statement.
- The written statement of particulars must be provided on or before the date on which employment starts, therefore becoming a ‘day 1 right’. Please note that the day one obligation does not apply to particulars relating to pensions, collective agreements, certain information on disciplinary and grievance procedures and any training entitlements provided by the employer, and employers still have 2 months after the beginning of employment to provide these.
- The statement will be required to contain the following additional particulars:
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- the days of the week the worker is required to work, whether the working hours may be variable and how any variation will be determined;
- any paid leave to which the worker is entitled;
- details of all benefits provided by the employer;
- any probationary period, including any conditions and its duration; and
- any training entitlement provided by the employer, including whether any training is mandatory and/or must be paid for by the worker.
- The minimum service requirement of 1 month will no longer apply, and all workers and employees will now be entitled to a written statement regardless of the proposed length of their employment.
- The changes will only apply to those starting work on or after 6 April 2020, or who enter into new contracts commencing on or after this date.
The Best way Forward post-6 April 2020
There is a longstanding debate in employment case law as to the status of terms contained in offer letters in light of subsequently issued employment contracts. With the incoming amendments to the law in mind, as well as the fact that the contents of an offer letter are commonly held to contain contractual terms, we recommend that to avoid any inconsistency and dispute, employees and workers be issued with their detailed contract of employment on day 1.
The main benefits of providing a complete employment contract on ‘day one’ under the new rules are that:
- There can be no dispute as to what terms bind the arrangement or any inconsistencies between documents, which prevents an employee subsequently arguing that they are entitled to contractual terms other than those set out in the contract;
- Employers ensure they comply with requirements to issue a statutory written statement of particulars by issuing a contract with all the terms required by section 1 on day 1; and
- Employers can deal with contractual terms in a way that is less administratively burdensome, by ensuring that the terms which bind employees and workers are clearly defined and contained within one document.
Whilst failure to issue a section 1 statement to an employee is not and will continue to not in itself be grounds for a claim against the employer in the employment tribunal, should an employee successfully bring a claim against their employer in the tribunal, in addition to any payment they receive for successfully pleading their course of action, an additional payment can be ordered against the employer for failure to issue written statement of particulars. Employers should therefore be proactive – Identify those employees and workers at your organisation who may be entitled to the written statement and ensure they receive something which satisfies the new requirements on day 1.
Summary / Conclusion
Employers should be aware of the broadening scope for the section 1 written statement of particulars coming into effect on 6 April 2020. If you need more advice on this, contact us and we can provide guidance and more details on your obligations from 6 April 2020. We recommend you take steps now to ensure you are ready for the changes.
In relation to offer letters, we believe that by providing an employee with a written contract containing all relevant terms on day 1, various issues around conflicting terms and inconsistencies between documents can be avoided. Be proactive – pin down the terms of an employee or workers employment, and ensure they have it on ‘day 1’.
Please do not hesitate to get in touch with any questions. If you need our assistance to facilitate the changes, we are more than happy to assist.