Top tips when reviewing employment contracts

Employment contracts are the building blocks of the employment relationship. However, they are often not given the care or attention they deserve. Even if a full review of your contracts is a step too far, it is worth giving them a regular health check.

Here are our tips for some key areas to focus on:

• Do you have a signed contract on file for each employee? It would be difficult to hold an employee to terms contained in a document which you do not have any evidence of them agreeing to.

• Do your contracts comply with the requirements for written terms set out in section 1 Employment Rights Act 1996? This sets out the legal requirements of an employment contract and may be more comprehensive than what you have in an older template. More recently, they have been updated to also require the inclusion of details of training provision and paid leave.

• Do your contracts work for your business? Different businesses will have different areas of focus. For example, businesses with sales employees will want to consider including restrictive covenants to control the ability of leavers to take customers with them when they leave. Businesses with fluctuating demand will want to consider adding an express clause allowing them to place employees on short-time working or to lay them off.

• Do your contracts give you control in key areas? Look for terms requiring employees to return company property; a right to suspend employees; a right to monitor employees and a right to deduct from wages for monies owed by the employee.

The employee would usually need to expressly agree to any changes you decided you needed to make to a contract, so be wary of making any changes after a review.