Statement of Employment Terms – important changes from April 2020

Significant changes are being made from 6th April 2020, that all Employers will need to follow, to the Statement employees and workers receive when they start work.

(These changes are contained in the Employment Rights (Miscellaneous) Regulations 2019 and the Employment Rights (Employment Particulars) Regulations 2019).

Currently, all employees are legally entitled to receive a document setting out their specific terms and conditions of employment. This is called a Section 1 Statement (as it is a requirement from Section 1 of the Employment Rights Act 1996) and it is usually included in their Contract of Employment.

Employees must receive this Statement within 2 months of starting work (unless their contract lasts only 1 month or less).

However, from 6th April 2020, all employees and workers (in England, Wales and Scotland), will need to receive a Section 1 Statement, on or before their first day of work (so this becomes a Day 1 right).

(updated 3rd March 2020)Statement

So, what does this mean?

Current Requirements of the Section 1 Statement Timescale when should be provided and how provided New Requirements of the Section 1 Statement (from 6th April 2020) Timescale when should be provided How provided (and other information)
         
The name of the Company and the employees/workers  name Within 2 months of starting (in the S1 Statement) The name of the Company and the employee or workers name Before starting or on Day 1

In Statement/

Contract

The date when their employment started and their period of continuous employment Within 2 months of starting (in the S1 Statement)

The date when their employment started.

For employees only, their period of continuous employment

Before starting or on Day 1

In Statement/

Contract

Their salary or rate of pay and the intervals at which it is paid Within 2 months of starting (in the S1 Statement) Same As Before Before starting or on Day 1

In Statement/

Contract

(give details of basic pay, any overtime/ commission, bonuses, allowances (can possibly refer to other details about bonuses/commission if they are not contractual, in other documents)

Their normal working hours Within 2 months of starting (in the S1 Statement) Any terms and conditions relating to hours – their normal working hours, the days of the week they are required to work (shift or flexible patterns); information if those hours or days are variable and how they may vary (e.g. refer to a rota).  Specify if overtime is compulsory or voluntary. Before starting or on Day 1

In Statement/

Contract

Any t&c’s relating to their holiday entitlement, including information about public holidays; holiday pay; accrued holiday pay on termination of employment. Within 2 months of starting (in the S1 Statement)

Same As Before

(The details given must be sufficient enough to enable the employee to precisely calculate their holiday entitlement – e.g. if you grant leave on a bank holiday, then specify a fixed number of holidays that include bank holidays).

Before starting or on Day 1

In Statement/

Contract

(State what elements of pay will be included in their holiday pay (overtime/commission).  State how you deal with carry over of leave).

 

Their job title and/or a brief job description Within 2 months of starting (in the S1 Statement) S/A Before starting or on Day 1

In Statement/

Contract

Their place of work, or if required to work in more than one location, and indication of this and the Company’s address.

Where an individual is required to work outside the UK for a period of 1 month, additional information about that.

Within 2 months of starting (but information about working abroad can be given as supplementary information) S/A Before starting or on Day 1

In Statement/

Contract

(If there is no place of work say this but give Employer’s address).

(The additional information of working outside the UK – the period for which they are to work outside the UK; the currency in which they will be paid; any additional pay or benefits resulting from working overseas; any T&C’s relating to the employee’s return to work).

n/a n/a If there is a probationary period, details, including any conditions and duration; whether it can be extended, when performance will be assessed, notice entitlements. Before starting or on Day 1

In Statement/

Contract

(NB – would not normally apply to workers, and should not apply to workers – therefore what to say tbc.).

If no probationary period say so.

The notice the Company needs to give, and the notice they need to give to terminate their employment Within 2 months of starting (but can be given as supplementary information) S/A Before starting or on Day 1

In Statement/

Contract

Where the job is not permanent, the period for which their employment is expected to continue; and if it is a fixed term contract the date it is expected to end. Within 2 months of starting (but can be given as supplementary information) S/A Before starting or on Day 1

In Statement/

Contract

Any Collective Agreements that directly affect their T&C’s. Within 2 months of starting (but can be given as supplementary information) S/A Within 2 months of starting (even if employment ends before then)

In Statement/

Contract

N.B. If not applicable say so.

Their entitlement to sick leave, including any entitlement to sick pay Within 2 months of starting (but can be given as supplementary information) Their entitlement to sick leave, including any entitlement to sick pay. And terms relating to absence. Before starting or on Day 1 Statement can have all or some of the relevant details; but Details can be contained in a separate document, e.g. Handbook or on intranet; does not need to be included in Statement
Information about the pension scheme the Company operates Within 2 months of starting (but can be given as supplementary information) S/A Within 2 months of starting (even if employment ends before then) Statement should say “comply with legal obligations to pensions” but Details can be contained in a separate document, e.g. Handbook; does not need to be included in Statement
Information about disciplinary and grievance procedures Within 2 months of starting (but can be given as supplementary information) S/A Within 2 months of starting (even if employment ends before then)

Statement should not the disciplinary rules that apply; the person to whom the employee can appeal to; the person with whom the employer can raise a grievance; but full Details can be contained in a separate document, e.g. Handbook; does not need to be included in Statement.

However, such information would not normally apply to workers and should not apply to workers, so information to be given, tbc.

n/a n/a

Their entitlement to any other form of paid leave (besides sick pay), including maternity and paternity leave, compassionate leave, jury service etc.

Any other benefits or remuneration not already in the statement (e.g. vouchers, lunch, Company Car, Car allowances, health checks, health insurance)

Before starting or on Day 1

Statement should refer to all forms of paid leave but state if contractual or discretionary; full Details can be contained in a separate document, e.g. Handbook; does not need to be included in Statement.

N.B.  If no additional benefits/renumeration provided, state this.

n/a n/a Any training entitlement provided by the Employer that is mandatory; any training entitlement which the employer requires the individual to complete; and any other training which the Employer requires the individual to complete and which the employer will not pay for. Within 2 months of starting (even if employment ends before then)

Statement should say if there is any mandatory training that you require the employee to do and who will pay.  Full Details of ‘any other training’ can be contained in a separate document, e.g. Handbook; does not need to be included in Statement (so not contractual).

If not applicable, say so.

If there is no information in relation to any of these items, this must be stated. Statement

Who does this apply to?

All new employees and workers engaged on or after 6th April 2020.

Existing employees (not workers) will have the right to request a Statement containing this additional information after this date – which must be provided within 1 month – and will be able to request this information any time up to 3 months after their employment ends.

There is no longer an exception for jobs lasting less than 1 month.

For existing employees (not workers) – if there is a change to any of their T&C’s, including to any new provisions that may not have been in their original statement, employers have to notify existing employees of the change (this is called a ‘trigger’) – e.g. if there is no mention of a benefit or training in their original contract, and it is changed, then the change would have to be notified to existing employees; within a month of the change.

Non-Compliance

If a section 1 statement is not provided by the Employer then individuals are entitled to make a referral to an Employment Tribunal for a declaration of what their T&C’s are. Like now, however, Section 1 Statement claims will remain ‘piggyback’ claims, meaning that if an individual is successful in making other certain claims, an ET can award them between 2-4 weeks pay (subject to the statutory weekly cap, which is currently £525 per week) for a failure to provide the required information in a Statement.

However, bear in mind this court case: In January 2019, in Miss Stefanko and others v Maritime Hotel Ltd, an Employment Appeal Tribunal found that 3 waiting staff had been automatically unfairly dismissed because they had asserted their statutory right to receive a written statement. They had bought claims objecting to ‘persistent shortfalls in their wages, late payment and a falsification of their wage slips’ even though they all had short periods of employment, following their dismissal on 7th July 2016.

Also – in Govdata Ltd v Denton in 2019, however, the Employment Appeal Tribunal said that as long as the statement is provided to the employee before an Employment Tribunal claim is lodged, the employee won’t be able to claim compensation; as the employers duty would have been met, even if it was met very late!.

What do we need to do now?

Review and amend template contracts for new employees, workers/casuals.

Decide if you are going to give all information on Day 1, or if you will delay certain information that you are allowed to.

Decide if you want to issue all existing staff with new contracts/statements; or know how you will deal with requests from existing employees for a Section 1 statement, and how you will handle ‘trigger’ information.

Make sure all your workers and employees sign and return to you a copy of their contract/statement.

If you need any help please let us know!  I’ll update this page if anything becomes clearer!

However, please note that this information is intended for general guidance only; it represents our understanding of the relevant law and good-practice as at February 2020.

The Human Resources Consultancy service for SME's in the UK creative industries

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