We are always drafting employment contracts for clients and often get to see their previous contracts that not been drafted by us. These are the ten most common mistakes we see in badly drafted employment contracts that often lead to disputes or misunderstandings later:

1. Ambiguity in Job Role and Responsibilities
   Not defining the role clearly can lead to confusion about an employee’s duties and responsibilities. Clear job descriptions and expectations help prevent misunderstandings and ensure alignment.
2. Lack of Specific Working Hours
   Employment contracts should clearly state the expected working hours, including any overtime expectations, shift patens or flexibility in working hours. Vagueness around hours can lead to issues, especially in disputes over pay and time off.
3. Incorrect Notice Periods
   Contracts need to specify notice periods for termination of employment, both from the employee and employer sides. The notice period should be reasonable depending on the nature of the role. You should consider if you require a long handover or are protecting your business assets. You may want to include “Garden Leave” clauses so that you don’t require an employee  that is on notice  
4. Misunderstanding of Employment Status
   Misclassifying workers as self-employed, independent contractors, or part-time staff when they are actually full-time employees can have serious tax and legal consequences. Ensure that employment status aligns with legal definitions and employment rights.
5. Insufficient Details on Salary and Benefits
   Salary information should be explicit, including payment frequency, bonuses, commission structure (if any), and any benefits like pension, health insurance, or company perks. Vague or missing details here can lead to disagreements about compensation.
6. Inadequate Holiday Entitlement and Leave Policies
   Contracts must clearly outline holiday entitlements, public holidays, sick leave, and any special leave policies, in line with statutory UK requirements. Inadequate leave policies can lead to disputes over accrued and untaken leave.
7. Non-compete Clauses that are Too Restrictive
   Non-compete and restrictive covenants, which prevent employees from working with competitors after leaving the company, must be reasonable and not overly restrictive. Courts may invalidate restrictive covenants if they are deemed too broad or unfair.
8. Overlooking Data Protection Requirements
   Employment contracts should reference data protection policies, especially if employees will handle sensitive information. This is particularly important for GDPR compliance in the UK. A lack of data protection details can expose both employer and employee to risks.
9. Failure to Specify Disciplinary and Grievance Procedures
   While not mandatory in the contract itself, it’s beneficial to outline or refer to the company’s disciplinary and grievance procedures. Without clarity here, employees may feel unsupported in case of issues, leading to disputes.
10. Unclear Terms Around Probation Periods
    If there’s a probation period, the contract should clearly define its duration, any evaluation criteria, and what happens if performance isn’t satisfactory. An unclear probation policy can create confusion if the employer or employee needs to end the relationship early.

Addressing these common issues during contract drafting or review can help ensure a smoother employment relationship and avoid misunderstandings or legal issues down the line.

If you would like us to review your contracts or draft new ones or just have a question please call us on 01920 463777 or email answers@qandalaw.co.uk.