Given the challenges posed by COVID-19, some employers might still be due to update their template contracts of employment, and worker contracts, in line with April 2020 changes to the rules on 'section 1 statements'.
What is a 'section 1 statement'?
You must give all employees and workers a written statement of certain terms of their engagement: often called a 'section 1 statement'. Most employers simply include this information in contracts of employment / worker contracts.
In the FAQs below, we outline changes to the rules on section 1 statements that took effect from 6 April 2020.
Who should get a statement?
Before 6 April 2020, only 'employees' were entitled to a section 1 statement.
Now, you must also give your other 'workers' a statement, even if they are not classed as your 'employees'. This does not include those who are genuinely self-employed.
You'll most likely need to make significant amendments to your 'worker' contracts, to include the necessary information.
For agency workers, the employment business that employs or engages the agency worker is responsible for providing the agency worker with a section 1 statement, rather than the end user.
When do we need to issue a statement? Does the information need to be in a single document?
Before 6 April 2020, you had to provide the information within two months of employment starting.
Now, you must provide the vast majority of information on or before the engagement starts, in a single document. There are some limited exceptions: you can provide certain information within the first two months; and your statement can refer to a 'reasonably accessible' document (such as a company policy) for some information. Workbox users can get more detail at our Section 1 statements page.
Do we need to issue statements for very short contracts?
Before 6 April 2020, you did not need to issue a statement if an employee was to be employed for less than one month. Now, employees and workers are entitled to a statement, regardless of the length of the engagement.
What does a statement need to include?
There is a fairly long list of information that must be included in a section 1 statement – for Workbox users, we have a table explaining the requirements.
New items were added to the list of required information from 6 April 2020, including:
- New detail on hours of work, including whether or not hours may vary and, if so, how they vary or how that variation is to be determined. Consider carefully your contract wording on this.
- Terms and conditions relating to 'other paid leave'. There was already a requirement to provide information on sick leave and holidays, so 'other paid leave' will include, for example, maternity and paternity leave, and any paid compassionate leave you provide.
- Particulars of all benefits you provide.
- Details of any probationary period.
- Any training entitlement you provide; any part of that training which is compulsory; and any other compulsory training you will not meet the cost of.
If there are no details relating to one of the required particulars (for example, there is no probationary period), you must state this.
Do we need to amend contracts of employees / workers who started before 6 April 2020?
You don't need to update contracts of individuals who started before 6 April 2020, to include the new information. However, from 6 April 2020, if an individual who started with you before that date requests a section 1 statement (either during their engagement, or within 3 months of it ending), then you must give them a statement (that complies with the new requirements) within a month of the request. You only need to respond to one such request from an individual.
Updating your contracts
Workbox users can access our updated template employee and casual worker contracts (with detailed drafting notes), along with additional FAQs and guidance on section 1 statements.
If you need advice on updating your contracts, please get in touch with your usual Brodies contact.