What should I do if an employee refuses to sign a contract of employment?

There is an obligation on employers to provide employees with a written statement of main terms of employment within two months of the employee starting to work for the employer. This written statement of main terms must include information such as rate of pay, holiday entitlement, hours of work and notice entitlement amongst various other things.

While the obligation is to provide a written statement of main terms within two months of the employee commencing employment, it is advisable to provide a written contract to a prospective employee with the offer of employment. This way an employer can make the offer of employment conditional upon acceptance of the written terms provided before employment commences. If the prospective employee has any difficulty with the terms of the contract, these can be discussed and can hopefully be resolved. If however the individual will not agree to the terms of employment offered, then the offer can simply be withdrawn.

The position is more difficult when it comes to existing employees. Many employers fail to provide a written statement of main terms to employees. We have recently advised several employers who had several employees who had worked with the employer for a long time and nothing had ever been written down. Sometimes when an employer attempts to rectify matters by providing employees with written contracts as required by law, this is met with some suspicion on the part of the employees. Employees can wonder why they are being asked to sign a contract after a long period of time with nothing in writing and this can sometimes lead to a fear that the employer is trying to adversely affect the terms of employment or that the employer may be about to embark upon a redundancy or disciplinary exercise.

Where an employer (rightly) decides to issue a written statement of main terms of employment for the first time to existing employees, the employer should take the time to explain that a contract of employment is already in place, albeit that it is not written down. The purpose of providing a written contract is so that the existing terms of employment are written down so as to comply with the law and to give clarity to both sides. Employers should take the time to discuss any queries or concerns that employees have about the written contract. Usually these queries can be resolved to the satisfaction of the employee.

Sometimes, no matter how well the employer explains the situation, certain employees will simply refuse to sign a copy of their contract. Where employees refuse to sign, employers should explore with them the reasons for this. If there is a particular issue, the parties should try to resolve this. Some employees wrongly believe that if they do not sign the contract, they cannot be bound by its terms and so will simply refuse to sign as a matter of general principle. In these situations, employers should clearly communicate that the terms as written down are the terms of employment under which the employee is engaged. If the employee continues to perform their duties and receive the benefits they are entitled to under the contract – such as pay and holidays – then the employer should notify the employee that the employer deems that the terms of employment have been accepted.

Collective Questions is intended as a guide and for general information only and is not a substitute for taking specific advice relating to your situation. For specific advice regarding this or any other issue relating to employing people, please do not hesitate to contact us.