You may be feeling elated because you’ve been offered a new job, or perhaps it is your first foray into full-time employment. If the salary stacks up and it’s what you want to do, shouldn’t you just skim the more detailed aspects of your employment contract and simply sign up? Well, no. It’s always best to read and understand what you are signing.
So what are the top things to focus on before you sign a contract of employment?
Job title and responsibilities
This is important because it defines the scope of what your exact role is, and what duties your employer can or cannot require you to do. The wider the job description, the more flexibility your employer will have to require you to take on more work, changing the goalposts. You should check that the job description adequately reflects the role you are applying for, and does not look to impose added responsibilities that you can’t or don’t want to do. Also check that the job title is correct. If the role is for a managerial position, for example, you won’t want the job title to simply state “executive”.
Place of work
If you have agreed to work in a wide geographical area, for example, other offices, locations in the UK or even abroad, your employer will be in a strong position if you object to a move at a later stage. If working remotely at home is a possibility and something you have discussed, then the contract should reflect this. Also, your rights to a redundancy payment could be adversely affected if you refuse to work in a new location, having previously agreed in your contract to do so.
Salary, benefits and bonuses
Make sure your employment contract reflects what was in your offer letter. You need to check there is provision for payment of other benefits that have been agreed, such as an enhanced pension, car, private health cover, equity or share options, bonuses and commission payments. Check if bonuses are guaranteed or discretionary. If based on performance, there should be set targets and an understanding of who decides whether the objectives have been met.
Hours of work
Don’t agree with a working pattern that you will later regret. It’s best to negotiate a variation at the outset if necessary, including the possibility of flexible working if this is the only way you can get the job done. As well as hours of work, check whether there are any shift patterns, including whether you are required to work weekends or evenings, and if so, for what days and for how long? Also check if you are being asked to “work all the necessary hours that the job entails”, and if so what is expected. Also check if you’re required to do overtime and if you will be paid for this.
You cannot take holidays at the time of your choosing, so if you are limited as to when you can take them, this should be addressed with your employer. You should lookout for the following:
- When the holiday year runs from. For example, is it from 1 January to 31 December? This will govern what balance of holiday you have left to take in the first year that you start your job
- Whether you are prevented from taking holidays at certain times of the year. Busy periods over Christmas, for instance
- Whether there is an entitlement to roll over any untaken holiday into the following year
It’s easy to brush over restrictive covenants when signing a new contract because they are only relevant after you have left. But future job prospects or business development could be hindered if they are too restrictive, especially if you are expected to transfer clients with you to your new employer. The usual covenants seek to prevent you from poaching clients, or working for a competitor for a period of time after you have left (typically three to six months, but they can be longer). Any personal clients or customers you introduce to your new employer may become integrated into your employer’s own client base and form part of your restrictive covenants when you leave, unless your contract says otherwise.
Check your notice is not unduly long or short. For most employees a notice period of one to three months is usual. A notice period that is too long could hamper you being able to take up a new job, and too short a period may not give you enough stability.
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