Hotel workers only employed for six weeks

The Employment Appeal Tribunal has held that three hotel workers who were dismissed shortly after they began work should have received “section one” statement of terms, or contracts of employment, setting out their employment terms and conditions.

Contracts of employment should be issued even after dismissal

Staff who are employed for a month or more are entitled to a statement of their employment terms and conditions, although employers do not need to provide them with one until their employment reaches the two month mark. In allowing an appeal of one of the worker’s claims, which had earlier been dismissed on the basis that her employment had only lasted six weeks. The Employment Appeal Tribunal said that “the obligation to provide the statement continues for employees with one month or more service, whether or not the employment relationship is ended in its second month”.

It’s good business to issue contracts of employment on time

Contracts of employment, often called Statements of Terms or Particulars of Employment, are extremely important for both employer and employee as they set out the rules of engagement, they give both parties guidance and make staff feel more valued so it’s not only a legal requirement but also good business to get your contracts of employment issued on time.  This article explains how to make sure you hit the deadline.

Changes in the pipeline

The law on issuing contracts of employment is changing. Although it has been the rule for many years that contracts of employment should be issued within 2 months, the law will change in Spring 2020.

The Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 have been made. These regulations, which come into force on 6 April 2020, amend the Employment Rights Act 1996 to provide that a written statement of terms must be given on or before the first day of employment.

Changes to the contents of contracts of employment

The regulations also add to the information that must be given in written statements or contracts of employment. They also amend regulation 16 of the Working Time Regulations 1998 to increase the reference period for determining an average week’s pay (for the purposes of calculating holiday pay). Where a worker has been employed by their employer for at least 52 complete weeks, the reference period is increased from 12 weeks to 52 weeks. Where a worker has been employed by their employer for less than 52 weeks, the reference period is the number of weeks for which the worker has been employed.

This development will make it much easier for payroll to calculate holiday pay. New HR  managers often query the need to calculate holiday based on fractions of the year not only because it takes more time but also because it can be either costly to the employer or unfair to the employee depending on when the calculation is carried out.

So for example a seasonal worker who cashes in their holiday immediately after a busy Christmas period will enjoy a bumper pay packet by contrast to those who wait and take their holiday later in the year when work has been thin on the ground for a few weeks. In this case it is financially beneficial to the employer to refuse holiday applications until 12 weeks of ‘normal hours’ has been racked up by staff.  The planned changes to contracts of employment will protect workers who work irregular hours.

Other matters arising

Appeals by the three workers against the dismissal of accompanying claims for race discrimination have been remitted to a new tribunal on the basis that the first tribunal “misapplied the burden of proof” and had not adequately explained how it reached the conclusion that they had not been directly discriminated against.

Case reference

Stefanko and others v Maritime Hotel Ltd (in voluntary liquidation)