How often should businesses look at their employment contracts? With the changing landscape surrounding workers’ rights and the so-called “gig” economy, a timely review is in order.
The current headlines around the gig economy, where people are engaged on a variety of contracts ranging from freelance, to self-employed, to zero hours, all boil down to one thing – grey areas can lead to litigation. The Conservative manifesto promises more rights to workers and employment contracts at companies like Uber and Deliveroo are being criticised for their lack of clarity, businesses that fail to keep abreast could be in dangerous territory.
Best practice considerations are below:
1. Ensure contractual terms are updated as the employment relationship develops. Minor changes can be made by letter but more substantial amends may require an update of the contract itself.
2. Regularly review contracts to keep them in line with current legislation and changing work practices.
3. Keep copies of contracts and letters changing terms. You may need to rely upon them as evidence.
4. Always include a right to vary terms and conditions unilaterally, if necessary, clearly stating the circumstances in which changes can be made. You may not be able to rely on such a clause; but it’ll give you a better starting point.
5. Always ensure there is a business justification ahead of making any changes. Consult directly with employees, or employee representatives, informing them of need for change and, wherever possible, obtain employee consent to the change – preferably in writing.
6. Consider including restrictive covenants to protect your business from employees. Ensure covenants are specific, focused and reasonable to protect business interests.