Section 1 Statement Of Terms And Conditions Of Employment

The government published its Good Work Plan back in December 2018 in response to Matthew Taylor’s review of employment practices. The Good Work Plan’s recommendations around the Section 1 Statement are aimed at increasing transparency between workers and employers as well as improving the enforcement of employment rights.

Employers are currently only legally required to provide a written statement of the main terms of employment to their employees within 2 months of the employee’s start date, this is known as the Section 1 Statement. Frequently, offer letters contain much of the required information and direct the employee to ancillary documents such as the employee handbook or other policies for details on holiday, sick pay and absences, disciplinary and grievance procedures.

Who Should Receive The Section 1 Statement Of Terms And Conditions Of Employment?

In order to protect those workers in the gig economy and other low paid sectors, all new employees and workers engaged on or after 6 April 2020 will be entitled to receive one document which sets out the main terms and conditions of employment on or before the first day of work. This document is known as the Section 1 Statement. There is no requirement to issue new Section 1 Statements to existing employees, however if an existing worker requests a Section 1 Statement after 6 April 2020 or if a term of the contract which should be stated in the new Section 1 Statement is amended you must provide a statement within 1 month of the request/change.

Previously, this requirement applied to employees only.

When Should The Section 1 Statement Of Terms And Conditions Of Employment Be Issued?

From 6 April 2020, the issuing of Section 1 Statements will become a day 1 right, meaning the Section 1 Statement will need to be provided on or before the worker’s/employee’s first day of work. Therefore removing the two-month grace period.

What Must Be Included In The Section 1 Statement Of Terms And Conditions Of Employment?

From 6 April 2020, the ability to provide certain information in instalments and by reference to other documents over the subsequent two month period is retained (e.g. referring the individual to where a disciplinary and grievance procedure can be found).

There are no changes to the existing information that must be included in the section 1 statement, but there are a number of items which are added to the list of clauses which are essential for inclusion within the Section 1 Statements, they are:

  • Working Hours: specifically, normal working hours, normal working days of the week, whether such working days are variable and if so, the basis on how that variation is determined;
  • Probationary Period: including its duration and any conditions that apply (such as a shorter notice period) during the probation;
  • Paid Leave: including sickness, holiday entitlement, maternity, adoption and paternity leave, shared parental leave, this will also include the new right to paid parental bereavement leave;
  • Training Entitlements: including details of any compulsory training, including whether the employer will pay for it;
  • Benefits: such as pension scheme, death in service benefits etc, both contractual and non-contractual benefits should be included; and
  • Working Outside the UK: any terms relating to any work the worker will be required to complete outside the UK for periods of more than one month.

What About Existing Employees?

These changes are not retrospective and only apply to new appointments on or after 6 April 2020. There is no requirement to issue new statements to existing staff unless you have made a change to the content of the statement which affects existing employees.

Existing staff will, however, have the right to request new Section 1 Statements at any time, including up to three months after the end of their appointment/employment, and you will have one month to comply.

Failure To Comply?

The existing mechanism for enforcing compliance with section 1 statement requirements will be extended to the new provision. Accordingly, a failure to provide a section 1 statement, or one that meets the requirements, may give rise to an employment tribunal claim from affected workers or employees for a declaration as to what part of all of such terms are. Additionally, if a claimant brings a successful discrimination, unfair dismissal or breach of contract claim, the tribunal must award the workers at least two weeks’ pay and this may be increased to four weeks’ pay.

Top Tip

Although you probably already have much of the required information available for employees/workers care will, however, be needed to ensure that an appropriate level of detail is included within the Section 1 Statement itself, as there will be less scope to rely on ancillary documents such as policies in an employee handbook.

It is important that your section 1 statements are updated and available in readiness for 6 April 2020 as these must now be provided to new employees on or before the day employment starts. You should also be prepared for the possibility that current employees will exercise their right to request a statement which includes the new information and should have new statements available for this group also that meet the new requirements.

The greatest change in practice is likely to be the extension of section 1 statement information to workers. Quite often the section 1 statement for workers will simply state, “there are no applicable terms relating to ….” and identify the non-applicable provision.

It is important that employers carry out a comprehensive review of exiting section 1 statements and the new requirements before 5 April 2020

HR Toolkit: Contracts of Employment
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My HR toolkit: Contracts of Employment provides an essential toolkit that will help you prepare employment contracts that protect your business and change an employee’s terms of employment in the future.

My HR Toolkit: Contracts of Employment will take you step by step through the statutory entitlement and explains the processes you will need to implement so you remain legally compliant and will deal with holiday matters fairly and consistently.

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My HR Toolkit: Contracts of Employment folder contains a range of guidance and resources to help you manage contracts of employment.

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Section 1 Statement Of Terms And Conditions Of Employment