Employment Contract

What is an employment contract in the UK?

An employment contract is a legally binding document according to which one person hires another person for work in exchange for paying salary, offering employee status, and granting benefits and other entitlements. A standard UK employment contract template defines job description and duties, place of work, number of working hours, duration of employment contract, amount of gross annual salary, sickness and holiday entitlements, notice period, etc.

Those sample employment contracts can be used for various types of employment across the United Kingdom, including:

• fixed-term or indefinite employment;
• normal working hours or overtime work;
• probation or without probation employment;
• remote working arrangement, hybrid or none;
• part-time or full-time employment.

It is important to note that the present contract template shall not be confused with zero-hours arrangements according to which an employer cannot guarantee any specific number of working hours.

Who needs this UK employment contract template?

This employment contract template can be a helpful legal solution for:

• HR departments and line managers willing to employ new staff;
• UK companies and business hiring new employees;
• Small businesses and self-employed individuals are looking for a reliable template to manage employees’ workflow.

This document can only be used for hiring a person for work with the status of the employee. If you are hiring a worker or a contractor, a service contract should be used instead.

What should be included in the employment contract template UK?

A standard UK employment contract template must include the following:

Details of the parties

The contract must outline full identification details of a person hiring an employee (i.e., an employer) and a person who is hired (i.e., an employee). To be eligible to work in the UK under the contract of employment, you have to have the following:

• British or Irish citizenship;
• Immigration status that allows work (for example, graduate visa or skilled worker visa); or
• Status under the EU Settlement Scheme.

Job Description

All employment contract templates in the UK shall clearly outline your job title and list of duties. The scope of work is usually defined in the text of the employment contract. However, some additional working duties and workplace behaviour can be outlined in separate disciplinary policies, employee handbooks, etc.

Place of work & working hours

A work under a contract of employment could be performed in either of the following ways:

• from office;
• from employee’s home;
• from any other location chosen by the employee;
• from several locations that are being defined from time to time by the employer; or
• hybrid working arrangement.

Duration of Employment

The contract of employment template UK must outline the date of commencement of employment. This is not the date of signing the employment contract but the date on which the employee starts their work with the company. It is common for many employers in the UK to establish a probation period for new employees. The average duration of the probation is between 3 and 6 months depending on the seniority role and type of the contract.

The employment contract template UK can last for the following:

• indefinite period of time (in other words, there is no fixed end date); or
• fixed-term contract (for example, 12 months).

Salary details

An employment contract sample must outline the annual gross salary of an employee in GBP. The gross salary means the amount of the employee’s wage before PAYE deductions and mandatory national insurance contributions.

Every employee’s salary shall not be below that established by the National Minimum Wage, which is being changed in April every year.

If the employee is expected to work overtime, the employer should also be aware of paying additionally for performed overtime work. The overtime rate can be stipulated either in the employment contract or in a separate overtime policy in place within the organisation.

Sickness & Holiday Entitlements

In accordance with the UK legislation, every person with employee status shall have the right to statutory holiday entitlements and minimum statutory sick leave.

Both the amount of a statutory holiday and sick entitlement are being defined pro rata to the number of years the employee has worked with the employer. Employee will be paid and entitled to the statutory minimum holiday entitlement of 5.6 times their usual working week. Where this total equates to any part-shifts or part-days, these shall be rounded up at the employer’s discretion.

Termination of Employment

Every contract of employment template must provide a notice period allowing an employee or employer to end employment relations. The statutory minimum notice periods are provided by the provisions of the Employment Rights Act 1996. The duration of the notice can be extended by the contract if both parties agree upon it. However, the notice period can never be decreased compared to the provided statutory minimum.

• One week’s notice. For employees who have been employed for up to two years.
• One week for each full year. An employee has worked between two and twelve years. For example, if an employee has worked for 4 years with the same employer, the contract can be terminated by sending a four-week notice.
• Twelve weeks. For an employee who has worked for more than 12 years with the same employer.

Why choose this employment contract sample over other samples?

By customising this sample employment contract template with FasterDraft, you get the document with the following key features:

• a document template that is tailored for your specific needs, not a generic document;
• a document that is created by real solicitors and not generated with AI;
• a contract UK employment template that includes all necessary clauses;
• a document with a clear structure;
• a contract that aligns with the Employment Rights Act 1996 and recent ACAS guidelines for employment contracts.

How to customise this contract of employment template in the UK?

To get a fully customisable contract template, follow a few easy steps below:

1. Click the “Create Document” button.
2. Answer simple questions in the form.
3. Select a template’s format – an employment contract template UK PDF or Word.
4. E-sign the document (optional).
5. Make a payment.

The UK employment contract template is ready for immediate purchase right after the purchase on our website.