United Kingdom

Employment Contracts

There is no prescribed form for employment contracts in the United Kingdom. In addition to a written or oral agreement, the terms of a British employment contract may be set out in an employee handbook, offer letter or collective agreement (if one applies to the employment relationship), among other places. Employment contracts generally include:

• Rights and responsibilities of the parties to the contract
• Employment conditions
• Duties of the employee

Regardless of the form the employment contract takes, all employers in Britain must provide employees with a written statement of particulars, which includes a principal statement. The principal statement must include:

• The name of the employer
• The name and job title of the employee
• A description of the work to be performed and the location where it will be performed
• The start date and end date (if the contract is for a fixed-term)
• The length and conditions of the employee’s probation period if there is one
• Salary and frequency of payment
• Hours and days of work (the principal statement must also specify if the employee is expected to work overtime, nights or on Sundays)
• Leave and any other benefits to which the employee is entitled
• Whether there is any obligatory training the employee must complete

Public Holidays

The following days are bank holidays in the United Kingdom:

• New Year’s Day
• Good Friday
• Easter Monday
• May Day / Early May Bank Holiday
• Summer Bank Holiday
• Christmas Day
• Boxing Day

If a public holiday falls on a weekend, the following Monday is a rest day.

Scotland and Northern Ireland each have additional holidays that are only observed in that country.

Compensation

Employers are not required to provide bonuses to employees but many employers choose to provide cash and non-cash bonuses as part of employees’ compensation packages.

Working Hours

The standard work week in the UK is 40 hours over five days and may not exceed an average of 48 hours averaged over 17 weeks. Some types of work that required 24-hour staffing are exempt from the maximum. Employees over the age of 18 years old can also voluntarily opt out.

Vacation Leave

Almost all employees in Britain receive 5.6 weeks of paid leave per year, which comes to 28 days of leave per year for employees who work a five-day, 40-hour work week. Employers may choose to grant employees additional paid or unpaid leave. Bank holidays may be included in the annual leave allotment or may be granted as additional paid days off from work. The employment contract should specify how these days are counted.

Sick Leave

Eligible employees in the UK receive up to 28 weeks of paid sick leave. If the employee is sick for more than seven days in a row due to illness (including weekends and holidays), the employee should provide the employer a note from a doctor, commonly referred to as a “fit note” or “sick note.” Employees may be eligible for Statutory Sick Pay and other benefits while on sick leave.

Maternity / Paternity Leave

Female employees are entitled to 52 weeks of maternity leave, 26 weeks of ordinary maternity leave followed by 26 weeks of additional maternity leave. The mother is not required to use the full 52 weeks of leave, but she must take at least two weeks immediately after giving birth. Eligible employees can receive Statutory Maternity Pay (SMP) for up to 39 weeks. SMP usually begins at the same time as maternity leave.

Male employees receive one to two weeks of paternity leave, which begins after the child’ birth. During this time, the male employee may be eligible for paternity pay.

Employees may be entitled to Shared Parental Leave (SPL) and Statutory Shared Parental Pay (SSPP), under which the parents of a baby, or parents who are adopting a child, can share up to 50 weeks of leave and up to 37 weeks of pay between the two of them.

Employment Termination / Severance

Employers generally must provide notice to the employee before ending the employment relationship. The notice is between one and 12 weeks, depending on the employee’s length of service. In practice, employers typically write longer notice periods into contracts. Employers may also provide payment in lieu of notice and terminate the employee immediately if the employment contract provides for it, or if the employer and employee agree on this arrangement.

Special procedures apply when employees are laid off due to redundancy. When possible, employers must try to avoid redundancies through measures such as reassigning redundant employees, reducing or eliminating overtime, ceasing to employ contractors and freelancers, or instituting temporary or short-term layoffs rather than permanent ones.

If there is no alternative to layoffs, or if there is still a need to lay employees off after all alternatives have been used, the employer must follow the legal process for terminations due to redundancy. Eligible employees receive a statutory redundancy payment, which is based on the employee’s age and length of service.

Employers are required to pay severance in some circumstances.

Health Insurance Benefits

The state provides universal healthcare for UK citizens and legal residents through the National Health Service (NHS). The NHS is funded by general taxes and by immigration health surcharges paid by some long-term foreign residents. Some UK residents also purchase private medical insurance. Some companies also provide supplementary private medical insurance as an employee benefit.