Employment contract template (UK): Create your own

When you hire a new employee, it’s important to set out the terms of their employment in a written employment contract. Not only will this make sure you’re both on the same page as to what your employee’s rights, duties and responsibilities are, but a written contract provides significant protections for your business and helps you to comply with your legal obligations. This guide provides a customisable employment contract template (UK) suitable for both junior and senior level hires and information about what your legal obligations are as an employer.

Employment contracts

Employment contract template (UK)

How do I create an employment contract template (UK)?

1. Select the appropriate employment contract template (UK) (Junior employment contract template for a junior hire and Senior employment contract for a senior hire)
   
2. Fill in the questionnaire to customise the contract to your new hire
3. Download your completed contract
4. Ensure that it is signed by your employee and a director of your company, remembering to date it at the top
5. Give a copy to your employee and retain a signed copy for your records

How do I create an employment contract for a junior employee?

You can use our Junior employment contract template (UK). 

This template includes all of the information that you are legally required to provide to new employees in writing (further guidance on this is set out later in this guide) and contains various additional provisions to help the smooth running of your business. 

There are some terms your employee’s contract must include or which will automatically be included by law, even if you try to exclude them, eg terms relating to minimum wage, minimum notice periods for dismissal and your obligations to provide a safe place and system of work. For example, even if your contract stipulates an employee is to be paid less than the national minimum wage or the national living wage, they will nevertheless be entitled to receive the minimum wage for their work. If you do not pay them enough, they can bring a claim against you for the balance.

This template is designed to work with our template Staff handbook. Some matters are addressed in the handbook rather than the contract. These include your disciplinary and grievance procedures. This is because it is more difficult to change such procedures if they are included in your contracts and your employee could theoretically sue you if you do not follow exactly what the procedures say.

Note that the more junior the employee, the less likely you are to be able to enforce any non-compete provisions in their contract (eg to stop them working for a competitor or poaching clients or staff after they leave). For this reason it is not recommended that your junior staff contracts have lots of restrictions like this in them. 

How do I create an employment contract for a senior or business critical employee?

You can use our Senior employment contract template (UK). 

This template includes all of the information that you are legally required to provide to new employees in writing (further guidance on this information is set out later in this guide) and various extra provisions to help the smooth running of your business. 

There are some terms your employee’s contract must include or which will automatically be included by law, even if you try to exclude them, eg terms relating to minimum notice periods for dismissal and your obligations to provide a safe place and system of work.

This template is designed to work with our template Staff handbook. Some matters are addressed in the handbook rather than the contract. These include your disciplinary and grievance procedures. This is because it is more difficult to change such procedures if they are included in your contracts and your employee could theoretically sue you if you do not follow exactly what the procedures say.

Given your employee’s seniority, you should consider the following before completing the template contract (there are options within the template’s questionnaire for the below information to be included):

• You will typically want to have a longer notice period for a senior employee so that you will have time to prepare for a transition if they leave your business.
• You may want to explain when you can terminate the contract if you need to. For example, if the employee is unable to carry out their duties for a long period of time, you will want to have the ability to replace them.
• If they leave your business you will want to do what you can to protect your business interests (such as your confidential information and business contacts). For further information on what kinds of protection you can include in your contract, see our Q&A on Confidentiality and restrictive covenants in employment contracts.

Providing written terms of employment 

What information must I give a new employee when they join my business?

The following are the minimum particulars of employment that you must give in writing to your employee:

• • the names of the employer and employee
  • the date the employment starts and the date the employee’s period of continuous employment begins (this is relevant because some employment rights do not accrue until after a period of continuous employment; eg the right to a minimum notice period)
  • how much the employee will be paid, or how their pay will be calculated, and how regularly they will be paid (eg weekly or monthly)
  • hours of work, including what their normal working hours will be
  • holiday entitlement and holiday pay (including their bank and public holiday entitlement)
  • the employee’s job title or a brief description of the work
  • place of work (if the employee is required or permitted to work at various places, this must be stated along with the employer’s address)
  • terms about absence due to incapacity and sick pay (you can refer the employee to other documents for these details if it is easier eg your staff handbook or absence policy document)
  • the notice period that the employee must give to end their employment and the notice that you must give them if you want to do so (you can simply say that your notice periods are those required by law if you are happy to adopt the legal minimums)
  • terms as to pensions and pension schemes (you can refer the employee to other documents for these details if it is easier and this information can be provided within two months of your employee’s start date rather than immediately)
  • terms relating to whether the employee may be required to work outside the UK for a period of more than one month, including how long it will be for, and additional benefits they will receive in compensation for working abroad, the currency in which they will be paid and any terms dealing with their return to the UK
  • if the contract is temporary, how long it is expected to last and when it will end
  • information about disciplinary and grievance procedures or where these can be found, including saying who your employee can appeal to if they want to appeal a disciplinary decision and who they can raise a grievance with (typically contained in a staff handbook: see Staff handbook and policies for a template policy, which you can choose to generate either on its own or as part of a full staff handbook). This information can be provided within two months of your employee’s start date rather than immediately
  • details of any collective agreements with trade unions directly affecting the employment eg an agreement reached by trade union representatives for a pay increase (you can refer the employee to other documents for these details if it is easier and this information can be provided within two months of your employee’s start date, rather than immediately)
  • further details about normal working hours, including the days of the week and whether these hours or days vary (and if so, how)
  • details about any other paid leave the employee is entitled to (besides sickness and holiday pay) eg maternity or paternity leave (you can refer the employee to other documents for these details if it is easier eg your staff handbook)
  • details of any other benefits not specifically mentioned in the list above
  • information about any probationary period, including any conditions attached to it and how long it lasts
  • details of any training entitlement, including whether it is mandatory and whether you will pay for it. Note that you are permitted to provide details about any non-mandatory training in a separate document if this is easier and that information can be provided within two months of your employee’s start date, rather than immediately.

Whilst most of this information must be provided to new employees in a single written document, some of the information (only where indicated above) can be provided in a separate document (eg a staff handbook) if this is more practical for you.

Be careful when providing certain information (eg about the benefits available to your staff) that you do not inadvertently make non-contractual or discretionary benefits a contractual entitlement. Our template employment contracts contain appropriate wording to protect your business from this eventuality.

Note that, if you do not have any terms to set out on any of these subjects (apart from in relation to your disciplinary and grievance procedures), you must state that there are none rather than omitting any mention.

How can I make sure that my employment contracts aren’t discriminatory?

You must make sure that you don’t give employees less favourable terms because they have a protected characteristic. If you do, you are at best at a substantial risk of a dissatisfied and demotivated workforce and at worst you could face a claim for discrimination.

To avoid this, do the following:

• Treat all comparable employees equally, for example, you must not pay women less than men where they are in comparable positions (see our Q&A on Staff pay for the rules on this).
• Be careful not to discriminate indirectly by offering different terms to different groups of employees that disadvantage one group more than another. For example, if you have working hours that are particularly difficult for single parents to comply with, these are likely to be discriminatory against women, who form the large majority of single parents.

Note that there is a limited legal exception which permits you to discriminate indirectly if you can justify it as an appropriate and necessary way of achieving a genuine aim. For example, a contractual requirement to regularly work a full day on a Saturday rota could be discriminatory against those for whom Saturday is the sabbath. It may be justified if it is your main trading day and Saturday working is unpopular with your staff generally, such that any exception would create tension among them.

Note that there are also protections for temporary employees and part-time employees. See our Q&A on Employment contracts for more detailed guidance. 

The content in this article is up to date at the date of publishing. The information provided is intended only for information purposes, and is not for the purpose of providing legal advice. Sparqa Legal’s Terms of Use apply.

Frankie Mundy

Before joining Sparqa Legal as a Senior Legal Editor in 2017, Frankie spent five years training and practising as a corporate disputes and investigations lawyer at leading international law firm Hogan Lovells. As legal insights lead, Frankie regularly contributes to Sparqa Legal’s blog, writing content across employment law, data protection, disputes and more.