Does a contract exist if no contract has been signed?

“I don’t need to give any notice, I don’t have a contract!” was a statement I recently heard from a friend as she explained she had recently been offered a new job and was mentally calculating when she could leave her old position for pastures new.

It is a common misconception from both an employer and an employee that if an individual has not seen, or signed their employment contract, then no legal relationship exists and neither party can take action against the other if the terms are breached.

Unfortunately for those who attempt to evade the law, and/or evade their obligations, this is not the case.

Employers are, in fact, required - at the very minimum - to provide their employees with a Section 1 Statement on day one of their employment which details essential information as required by law, but many employers prefer to provide their employees with an employment contract which further clarifies each party’s obligations under the contract. If an employer does not provide this document, and at a later stage seeks to rely on one of the terms, for example the notice period, it will be very difficult to prove that the employee was made aware of what the period of notice was expected to be, and as such, the employee may be entitled to rely on the statutory notice periods which could be as short as just one week.

In contrast, where an employee seeking to rely on the fact that a contract has not been signed but they have seen, they are unlikely to successfully argue that they are not bound by the terms of the contract if they have been working in accordance with those terms. Acceptance of employment terms can be made by conduct alone, a signature on the contractual document is not necessary.

In order to avoid confusion and issues with employees, it is prudent to ensure the necessary documentation is in place when a new employee joins the team. Not least because there is a legal obligation on employers to provide their employees with some essential details from day one, but in order to prevent disputes over specified (or unspecified) terms further down the line.

If you would like to discuss your obligations as an employer regarding the employment documentation you are required to have in place, or any other employment related query, please contact Lisa Downey on 01992 422128 or email lisa@ghsolicitors.co.uk.