3. THE EMPLOYMENT CONTRACT

At its simplest, an employment contract is an agreement by a worker to carry out a particular kind of work for an employer in return for pay and other benefits. The contract sets out the terms that govern the employment relationship. These terms can either be specifically agreed (also known as express terms), whether orally or in writing, or implied through conduct or custom and practice, or because they are essential to the employment relationship. An express term cannot take away a minimum statutory right, for example the statutory right to annual leave under the Working Time Regulations 1998.

Some terms are “incorporated” into the contract through a separate document or agreement. For example, collectively agreed terms negotiated between a union and the employer can be incorporated into the individual employment contract, to become binding contract terms. Not all collectively agreed terms will be part of contract of employment.