Employment Contracts

Getting to grips with the finer details of employment contracts is advisable for many reasons, not least if you want to protect your business from costly litigation.

The employment contract is one of the most important documents in any business and it’s wise for every employer to ensure that the contract covers all the essential points.

The agreed terms of the contract are crucial in determining the rights and duties of both the employee and the employer and prove essential in the event of a disagreement.

If the event of any employee disputes, the first question you’ll be asked is – ‘Is there a contract of employment in place?’ If the answer is ‘no’, you’re not going to be looked on very favourably.

Continuous changes in legislation governing the workplace make it critical for every employer to keep on top of ongoing developments and to ensure that they are reflected in the employment contract.

Disputes relating to the employer’s failure to meet his or her obligations can be referred to an Employment Appeals Tribunal, a Rights Commissioner, the National Employment Rights Authority (NERA) or involve litigation. This may result in the employer incurring fines, legal costs, employee awards plus the cost of the unwanted media attention and unrest in the workplace.

Essential details

Employers are required to provide the employee with a written statement of the terms and conditions relating to his or her employment, within two months of the start date.

The Acts generally apply to any person working under a contract of employment or apprenticeship and anyone employed through an agency or in the service of the State. It does not apply to any employment where the employ­ee works less than eight hours per week or where the employee has been in the continuous service of the employer for less than one month.

It is important to distinguish between a contract of employment, which means a ‘contract of service’, and a ‘contract for service’. A person working under the latter agreement is a self employed as an independent contractor, which means a different set of rules apply.

The written employment contract statement must contain a number of points including, but not limited to, the following:

  • Full names and addresses of the employer and employee.
  • Place of work, or where there is no fixed or main place of work, a statement specifying that the employee is required or permitted to work at various places.
  • Title of the job or nature of the work for which the employee is employed.
  • Date of commencement of employment.
  • In the case of a temporary contract of employment, the expected duration or, if the contract is for a fixed term, the date on which the contract expires.
  • The rate or method of calculation of the employee’s remuneration.
  • Any terms relating to hours of work (including overtime).
  • Any terms relating to leave.
  • Pensions/medical scheme/sick pay (only if applicable ‑ if sick pay is not provided this must be stated in the contract).
  • Notice of termination of the contract of employment.
  • Grievance and disciplinary proceedings.
  • Any collective bargaining agreements.

In addition to the above, the employment contract should also include a statement on the company’s code of practice in relation to rest breaks, bullying and harassment, a health and safety statement and information on the company’s policy in relation to internet, email and voice telephone usage.

The inclusion of the company’s disciplinary procedure is one of the most essential components of the employment contract. The Employment Appeals Tribunal is obliged to penalise any employer who fails to follow this procedure through.

As an alternative to providing some of the details in the employment contract, the employer may use the statement to refer employees to certain other documents containing the information, provided the document is provided to the employee on issuing the contract.

For example, the company’s code of practice in relation to certain procedures might be included in an employee manual instead. However, it’s essential to keep this updated and to ensure the employee signs off on it.

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Related Article:           Terms and Conditions of Employment Checklist

Please call Noel Murphy today on 021-4310266 if you need further information on employment contracts or a consultation.