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Over recent years, there has been plenty of debate around the gig economy, the risks of zero-hours contracts and associated lack of employment rights and benefits. HMRC research in 2021 found that only 84% of workers had a written contract of employment, compared to 93% of employees. This figure will inevitably change with the implementation of the amended Employment Rights Bill and the abolition of fire and rehire policy, and changes to zero-hours and agency workers’ rights.
In this article we explain the ins and outs of contracts of employment, what to include and why they are an essential legal document. We share the differences between a written statement of particulars and a contract, and what to include in each. We also look at the impact the Employment Rights Bill will have on contracts and share some best practice tips. If you have further questions, contact us here.
What is the difference between a contract of employment and written statement of particulars?
There can be confusion as to the meaning and purpose of these two elements.
A contract of employment is the legal agreement between an employee and their employer and can be verbal though some aspects must be written down. It forms the basis of the employment relationship and comes into existence when the employment begins.
A written statement of particulars sets out the statutory terms and conditions that apply to all employees and workers, and this must be provided on or before the first date of employment.
Often nowadays, the written contract of employment issued to employees, on or before the first date of employment, contains all the statutory terms and conditions that are required under the written statement of particulars. This removes the need to send two documents.
Whether you employ permanent staff, agency workers like seasonal staff, or benefit from a mix of both, having accurate, compliant contracts of employment and written statements of particulars protects all parties from undue risk.
A written statement of particulars or a contract of employment does not have to be signed for it to be valid. If the worker or employee has been working in accordance with the terms of the agreement, then it can be presumed that it has been accepted.
The cost of missing and inaccurate contracts
Cases taken to tribunal are costly, may incur financial penalties and damage your business reputation. Potential basis for claims include:
unfair dismissal
breaches of contract
unpaid wages.
From an employee and worker perspective, not having an accurate, up-to-date contract of employment or statement of particulars can be highly unsettling. Without such terms, employees and workers forgo certain rights and protections. They may be at risk of their wages not being paid or become victims of unfair dismissal. Employees and workers without a contract or statement of particulars may feel less of a connection to the organisation and be less motivated and productive as a result.
Evolution of employment contracts in the UK
Did you know the earliest form of employment regulation dates back to the 14th century? Following the Black Death, the UK population had declined significantly. To ensure there were sufficient people available for work, legislation was introduced to fix wages and restrict workers’ movements.
In 1823, the Master Servant Act put the power firmly in the hands of employers. Would you believe workers who breached their employment contracts were at risk of being put in prison. Thankfully, modern employment law takes a more lenient view!
A significant milestone was the introduction of the Trade Union Act in 1871. Workers gained new rights of employment, including the right to strike.
It’s incredible to think the right to maternity leave, redundancy compensation and protection against unfair dismissal didn’t exist until 50 years ago when the Employment Protection Act 1975 was passed. That same year, the Sex Discrimination Act came into force, starting the movement for gender equality in the workplace.
When it comes to contracts of employment, the Employment Rights Act 1996 mandated that every person classed as an ‘employee’ must receive a written statement of particulars of employment, such as working hours and pay - more on those below. In the UK, on 6th April 2020 the right to receive a written statement of particulars was extended to all ‘workers’, including employees, zero-hours workers, casual and seasonal staff.
The only individuals who are exempt are:
employees who are members of the armed forces
employees who are classed as merchant seamen and women.
The role of a Contract Of Employment
A contract of employment is a legally binding document which sets out the terms of the contract between employer and employee. When drafting terms for a contract of employment, you should draft them with as much clarity as is possible to avoid potential issues during the course of the employment relationship. The contract must include at least all statutory elements as required under the written statement of particulars (see below). Any changes to the terms within contracts of employment must be made by mutual agreement between employer and employee. This is an important consideration for businesses preparing for changes under the amended Employment Rights Bill 2025.
What to include in a Contract of Employment
An employer must provide an employee or worker with a principal (or main) statement of basic terms of engagement, in line with the Employment Rights Act 1996, on or before their first day of work. This should include:
Names of the employee and the employer
The start date and reference to continuous employment
If the role is a fixed contract, the contract must state the end date
The job title together with a description of the role
Place and hours of work to include the days of the week to be worked and, if and how hours or days may be varied.
Specific details about working abroad if the employee is required to do so for more than one month
Probationary period length and conditions, if applicable (the employer has the right to extend this if necessary)
Salary (to include instances when the employer can make deductions)
Scale and rate of pay or the method of its calculation, and the intervals of payment
Details of eligibility for holiday entitlement, how pay is calculated and provisions in the event of termination of employment
Details and terms of sick pay and any other paid leave entitlements
Details of pensions and pension schemes
Details of other employee benefits, such as financial and benefits in kind
The duration of notice to be given, or provided by, the employee to terminate employment
Details of any collective agreements which directly affect terms and conditions
Rules and procedures relating to disciplinary (or referring to a separate accessible document) and identifying the person to whom to raise a grievance or appeal against a disciplinary decision.
Details of training provision and requirements.
A contract of employment can be much broader than just the written statement. In addition to expanding on the express terms of the written statement, contracts usually go into more detail around expected conduct and adhering to company policies such as GDPR, keeping data safe, and using social media.
All contracts include a mix of express terms and implied terms. Express terms are things like pay, hours and holiday entitlement and are specifically stated, either spoken (usually at the interview stage) or in writing. The implied terms refer to issues that are obvious to maintain a trusted and respectful relationship between employer and employee. These may not necessarily be spoken or written but are considered to be part of the contract for example, to be provided with a healthy and safe environment in which to work in. Contracts begin when the employee starts work.
Where information is not available at the start of employment, some terms can be provided in instalments, but no later than two months after the start date.
Struggling with where to begin with creating compliant HR documentation? We can supply you with templates, advice and guidance to get you started.
Contact us to find out more
Changes to contracts following the Employment Rights Bill
In July 2025, the Government published its Employment Rights Bill roadmap setting out four key phases when measures will be introduced. Variations and amendments to employment contracts may be required to prepare for some of the legislation changes, which at the time of writing are progressing through the parliamentary debate process.
Measures that may require contract amendments are not due to come into effect until October 2026 at the earliest. That said, you should start the review process as soon as possible to highlight the terms that may need to be updated.
Measures coming in October 2026
An end to fire and rehire with automatic unfair dismissal implications
A modified ‘light touch’ dismissal procedure
Proposed measures for 2027
New rights for zero hours and agency workers, including the right to a guaranteed hours contract.
Don’t have the resources to keep on top of changes in employment law? See how outsourcing HR to P3 People Management ensures compliance and takes employment contract creation, updates and audits off your desk.
Making changes to contracts of employment
Employers have a duty to maintain accurate and up-to-date contracts of employment for their employees. Changes to mandatory terms and conditions include hours of work, pay, pension, redundancy, health and safety issues, works councils and transfers of business. By law, employers must put any contract changes in writing within one month of the change.
Sickness, pensions and disciplinary rules and procedures can be treated differently. A written notice may refer employees to other sources, such as online policies or an employee handbook, for full details.
Non-statutory amendments to the terms within a contract of employment should only be made following consultation, and with the agreement of the employee. We advise taking professional HR advice prior to making any changes of this nature.
It is important to check the individual’s employment history before proposing any changes, for example if the employee has been subject to a TUPE transfer it may be more difficult to vary their contract. Be sure to communicate all changes clearly so your team understand their amended contractual rights.
Tips to avoid uncertainty and disputes
l Set out clearly all the terms applicable to the individual and their role
l Provide the written statement and/or contract to the employee before they take up their position.
An employee may bring a claim in an employment tribunal for breach of s.1 and s.2 of the Employment Rights Act 1996 if a contract/statement of terms of employment is not provided within the timescale; is incorrect; or not kept up to date.
Review employment contracts regularly
Employment law changes frequently, so it pays to keep abreast of what is going on and regularly review contracts to keep both parties protected. Ensure that any changes and the reasons for them are fully communicated to employees, whether you need their consent.
Consider the following areas when reviewing contracts:
employee status
equal pay
minimum wage
part-time and fixed-term working
flexible working
working hours, and
parental leave.
Don’t be put off by paperwork
Contracts take time to prepare, but they are a crucial foundation for building mutual trust with your team. Contracts of employment set out clear expectations and responsibilities both employee and employer must adhere to.
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