E104 CONTRACT OF EMPLOYMENT FOR THOSE WORKING PART TIME HOURS
Please note that these Explanatory Notes are for guidance only and do not form part of the contract
PART TIME WORKING
The Part Time Hours Workers Regulations July 2000 ensures that part time workers will be treated no less favourably than full time workers. The regulations cover all aspects of employment and therefore all benefits should be pro rata and the same as those applied to full time workers. For example:
receive the same hourly rate as comparable full-timers;
receive the same hourly rate of over-time as comparable full-timers, once they have worked more than the normal full-time hours;
not be excluded from training simply because they work part-time; and,
have the same entitlements to annual leave and maternity/parental leave on a pro-rata basis as full-time colleagues.
have the same access to pension schemes and pension scheme benefits.
All entitlements should be pro rated by dividing the annual entitlement by the basic full time working hours per week and then multiplying by the part time hours.
Any rounding which occurs should be to the individual’s benefit.
Page 1 contains a covering letter to send with the terms and conditions of employment.
A duplicate of the contract (signed by employer) should be sent to the prospective employee for their records and to allow them to sign and return one copy to you to be retained. This will act as proof that the employee has accepted the terms and conditions of the contract
The contract can be issued to an employee after they have joined as long as it is not later than 8 weeks after the employment began.
It is important that you review the contract to ensure that it is applicable to your business requirements.
As will be seen, there are numerous details that need to be completed in the Terms and Conditions. Also there are a number of alternative clauses that need to be considered, with the inappropriate wording deleted. Guidance is given below as to some clauses that you may wish to amend or review.
It is important to ensure that all employees are treated equally and that no direct or indirect discrimination takes place by including clauses for some categories of staff and excluding them for others.
NOTES ON SPECIFIC CLAUSES
1. APPOINTMENT, COMMENCEMENT, DUTIES AND PLACE OF WORK
1.1 The employer needs to specify the commencement date of the contract.
1.3 If there is unlikely to be a requirement to travel abroad, state as such
1.5 The length of a probationary period can be varied. During the probationary period the employee should receive objective feedback about their performance and the feedback should be documented. This should include the setting of specific targets for improvement if appropriate. The probationary period should not be extended for more than 6 months in total. During this time a final decision should be made about the employee’s suitability for the role.
2. HOURS OF WORK
2.3 It would be usual for the employee to have to work whatever is the normal full time working week hours before being able to claim overtime payment, Therefore some additional hours worked may be paid at the normal flat rate before being eligible to claim overtime.
4.7 Either a part-time employee has enough annual entitlement to take all the statutory holidays and then additional days that they choose on top, or if they don’t have enough annual entitlement and the employer wants to, it can pro rata a part time employee’s entitlement to bank holidays with any additional days taken as unpaid or worked at another time. For an employee whose non-working days fall on those days on which bank holidays normally fall (Mondays and Fridays), then the easiest way is to calculate annual entitlement at the beginning of the year and then award days off in lieu for those holiday days they have “missed out” on.
5. ABSENCE DUE TO ILLNESS
5.2 It is suggested that a medical certificate be produced for absence in excess of 7 calendar days.
The government introduced compulsory workplace pensions from 2012 and vast numbers of employers, from the largest to the smallest, were affected.
Initially, smaller businesses with fewer staff need not to worry, because the reform will be carried out in stages.
Only employers with over 30,000 staff were forced by law to offer their workers a company pension scheme in 2012.
By 2013 any employer with more than 350 staff on its books was obliged to set up and contribute into workplace plan for its employees.
Between 2014 and 2016, those employers with less than 350 staff will be subject to the same rules.
Employees will be auto-enrolled and can expect their company to put a minimum 3% of any earnings between £5,035 and £3,540 into each worker's fund.
To help, the government is introducing NEST – National Employment Savings Trust – which will be provide a state-led alternative for any employer wishing to use it.
Here are some tips for employers to consider as the reform come into effect.
1. Budget now
Consider the cost impact of the compulsory 3% employer contribution or if you offer a higher contribution rate, the cost and sustainability of enrolling all staff on this basis. Consider also whether you will make contributions on the full salary amount or band earnings.
The key is to budget now for the new measures, so that bigger pension contributions will not mean a sudden spike in costs. One solution may be for employers to consider reviewing their total remuneration package to absorb the extra costs and looking at methods such as salary sacrifice as a cost-effective way of increasing pension contributions.
2. Decide which type of pension you want to offer staff
Consider the advantages and disadvantages of an employer pension scheme and the NEST scheme and decide which is more appropriate for your own organisation. It may be that a combination of the two schemes is the best approach in the first instance, with different staff being eligible for different schemes e.g. senior and employed staff being enrolled into an occupational scheme and contract staff being enrolled into a NEST.
3. Consider the impact on retaining and recruiting employees
What do you want your pension to say about your organisation? Consider how you want your pension scheme to fit in with your overall benefits package. While some employers may take this opportunity to reduce their pension contributions, organisations that provide pension schemes above the standard laid out by the Government are likely to be a more attractive proposition for new and existing employees and demonstrate a commitment to their workforce.
Employers who do intend to offer schemes with contribution rates above the statutory minimum may be interested in applying for a pension quality mark to differentiate their scheme from others. (www.pensionqualitymark.org.uk)
4. Does your existing scheme meet the Government's requirements?
Examine any existing pension schemes you have in place to determine if they will meet the minimum requirements set out by the Pensions Act. Also consider the likely cost implications of enrolling all non-members into this scheme. In particular, I would advise employers to review their default funds to ensure that they are appropriate for all staff, taking into account the ages of employees, especially those nearing retirement and any ethical or moral views regarding investment.
5. How will you communicate the changes to your staff?
Consider how you will go about communicating these changes to your staff. It is important to try and engage employees with their pension and there are a variety of methods on hand to do this.
6. Do you have systems in place to deal with the administration?
It is important to ensure that your payroll and HR systems are able to cope with any extra administration. This will be particularly relevant for any organisations that intend to run both an occupational pension scheme and enrol some staff into the NEST system.
7. When do you need to start considering what to do?
Starting to prepare for the reform now is a good idea. Beginning sooner, rather than later, will enable changes to be broken down into smaller, more manageable tasks rather than waiting for the Pensions Regulator to begin contacting employers directly, which it is scheduled to do from 2012.
For more information for employers and employees visit:
It is advisable to have a confidentiality clause, which not only requires the employee to maintain confidentiality while working for the employer but also after the contract comes to an end. In addition the clause requires an employee to return documents belonging to the company at the end of the contract.
Clauses designed to prohibit an employee from soliciting clients are commonly included in employment contracts, along with other restrictions, but there is a lot of case law on this subject and legal advice should be taken on precise wording of this clause.
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