If you have been an employee before starting your own business, you’ll be aware of many of the rights employees have. However, there are probably some that as an employer or potential employer you may not have come across. Here we give some examples of lesser known rights – both of employees and the employer.
The rights of both employees and employers are set out by statute law. That means that the terms in an employment contract cannot reduce the rights of either party – only strengthen them.
Employment contracts do not have to be written. They could be verbal. However, recording the terms in writing provides evidence of what was agreed should there be a disagreement later.
1. Rights by custom and practice
In addition, “custom and practice” also forms part of the employment contract. These are benefits that employees receive customarily within the workplace. Examples might be; a day off on Christmas Eve, free or subsidised meals, or local gym membership. The employment contract may not mention these benefits – it may even say something else – but if the employees have been regularly receiving a benefit with the employer’s knowledge and consent, then that benefit becomes a right. Employers should be very careful about establishing benefits that may become contractual.
2. Written particulars of employment
Employers must provide a written statement of the main terms of the employment (called “particulars”) within two months of starting employment. These include:
- job title
- pay, including sick pay
- entitlement to enrol in pension schemes
- hours of work
- holiday entitlement
- notice period to end the contract
- business procedures regarding grievance, dismissal and discipline
3. Rights of part-time employees
It is a common misunderstanding that employees on part-time or zero hour contracts have fewer employment rights. Employees have the same rights regardless of whether they work full time, part-time, are on a permanent, zero hours or a fixed term contract. The only difference in rights given by different types of contract is that rights related to time are pro-rata (proportional) to time worked.
This means that an employee who works an average 14 hour week over a six month period is entitled to one fifth of the holiday entitlements of an employee who works full time on a permanent contract.
4. Deductions from pay
An employer can make a deduction from pay only under specific circumstances. To do so otherwise is illegal. Those circumstances are:
- The deduction is required by law, for example, a deduction for National Insurance.
- The deduction is allowed by a specific paragraph in the employee’s written contract, for example, for a payment to a pension scheme.
- The deduction has been agreed in writing by the employee.
- The employee has been genuinely overpaid.
- The employee took part in industrial action.
- A court or employment tribunal has made an order to do so.
- The worker is a shop-worker and the deduction is to compensate the employer for the dishonesty of the employee or because of theft by a customer. The employer must give the employee written details of why the deduction has been made and must make the deduction within 12 months of the incident. The deduction cannot be any more than 10% of the shop-worker’s gross pay on any one payday. There is no limit on how much the employer can deduct in total.
5. Monitoring communications
Employers have the right to monitor their employees’ communications. An employer who does so, should have a written business policy in place, as part of the employee handbook. That policy should set out what is not allowed and what disciplinary action might be.
The conditions for monitoring communications are:
- The employer has previously notified employees that monitoring will take place.
- The monitoring is relevant to the business.
- The communication systems are partly or wholly for the use of the employer’s business.
Surveillance might extend to:
- opening and reading post and e-mails
- recording telephone calls and fax messages
- monitoring Internet use
- recording CCTV footage
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Reference to any organisation, business and event on this page does not constitute an endorsement or recommendation from the British Business Bank or the UK Government. Whilst we make reasonable efforts to keep the information on this page up to date, we do not guarantee or warrant (implied or otherwise) that it is current, accurate or complete. The information is intended for general information purposes only and does not take into account your personal situation, nor does it constitute legal, financial, tax or other professional advice. You should always consider whether the information is applicable to your particular circumstances and, where appropriate, seek professional or specialist advice or support.