CHAPTER 2
The sources of
contractual terms
The sources of contractual terms
Introduction
This section concerns the contract of
employment and how it comes into
existence.
It is important to understand the
influences that contribute to
establishing the contents of the
contract because they have
important implications.
The sources of contractual terms
• Express terms agreed between
the employer and the employee,
or the employee’s
representatives, normally take
precedence over all other terms.
The sources of contractual terms
• There is a statutory requirement
for the employer to issue written
particulars of employment to new
employees within two months of
their start date.
The sources of contractual terms
• These particulars must be
considered in detail because
they establish the nature of the
contract of employment.
The sources of contractual terms
• Apprentices and merchant
seamen can only be employed
under written deeds and articles
respectively. With these
exceptions, contracts of
employment may be oral or in
writing. A contract of employment
is subject to the general
principles of law.
The sources of contractual terms
• It is an important principle that
the parties are free to negotiate
the terms and conditions so
long as they remain within
statute and the common law.
The sources of contractual terms
• Terms included in the contract –
express terms – normally take
precedence over all other terms
apart from those implied by
statute.
The sources of contractual terms
• Not later than two months
after the start of employment
the employer must supply
written particulars of
employment, as provided for
in sections 1–3 ERA 1996.
The sources of contractual terms
STATEMENT OF PARTICULARS
• The following information must be
given to employees individually:
The sources of contractual terms
1) The identity of the parties
2) The date on which the
employee’s period of
continuous employment began
The sources of contractual terms
3) The scale or rate of
remuneration, or the method of
calculating remuneration, and
the intervals at which
remuneration is paid
4) Any terms and conditions
relating to hours of work and
normal working hours
The sources of contractual terms
5) Any terms and conditions
relating to holidays and
holiday pay
6) Any terms and conditions
relating to incapacity for work
due to sickness or injury
The sources of contractual terms
7) Any terms and conditions
relating to pensions and
pension schemes
8) A note stating whether a
contracting-out certificate is in
force
9) The length of notice which the
employee is entitled to receive
and is obliged to give
The sources of contractual terms
10)The title of the job or a brief
description of the employee’s work
11)Where the employment is
temporary, the period for which it is
expected to continue, or, if it is for a
fixed term, the date when it is to end
12)The place of work, or, if the
employee is required or permitted to
work at various places, an indication
of the employer’s address
The sources of contractual terms
13)Any collective agreements which
directly affect the terms and
conditions of employment,
including, where the employer is
not a party, the person by whom
they were made
14)The terms that apply where the
employee is required to work
outside the UK for more than a
month.
The sources of contractual terms
15)Any disciplinary rules applicable to
the employee and any procedure
applicable to the taking of
disciplinary decisions (including
dismissal) relating to the
employee
The sources of contractual terms
16)The name or description of the
person to whom employees can
apply if they are dissatisfied with any
disciplinary decision or seek to
redress a grievance
17)Any further steps consequent upon
an application expressing
dissatisfaction over a disciplinary
decision (including dismissal) or
grievance
The sources of contractual terms
• The statement of particulars does
not constitute a contract of
employment. It is merely the
employer’s version of what has
been agreed.
The sources of contractual terms
• Terms of a contract may be
derived from collective
agreements as well as being
individually negotiated.
• Substantive terms from a collective
agreement may be incorporated
into an employee’s contract of
employment expressly or impliedly
or as a result of custom and
practice.
The sources of contractual terms
• It is important to know that about
two-thirds of workplaces in the UK
do not have any employees
covered by collective agreements.
The sources of contractual terms
• Workforce agreements can
provide for a variation in the
Working Time Regulations and
other specified rights where there
is no collective agreement.
The sources of contractual terms
• Works rules are normally
determined by the employer and
can be expressly or impliedly
incorporated into a contract of
employment.
The sources of contractual terms
• Custom and practice – if it is
definite, reasonable and generally
applied – can be used to fill gaps
in the employment relationship.
The sources of contractual terms
• Terms, such as the equality clause
in section 1 EPA 1970, can be
implied in the contract of
employment by statute.
• Terms can also be implied by the
common law if they are consistent
with the express terms.