A contract of employment is formed when a job applicant accepts the employer's offer of the job. There is no need for a contract of employment to be in writing, so the offer can be made and accepted orally, perhaps in a telephone conversation. Alternatively, the employer may set out the offer fully and formally in a letter and ask the applicant to confirm in writing that he or she accepts the terms. In practice, it is preferable for a job offer to be made in writing, to ensure that the terms of the offer are clear.
Once the job applicant has unconditionally accepted an unconditional job offer, he or she has a contract of employment, even if he or she has not yet started work. Therefore, if the offer is intended to be conditional on certain events occurring, such as the employer receiving satisfactory references or medical reports, then the employer needs to make that clear. The contract will then not take effect unless and until those conditions are met. But if the employer allows the employee to start work before the conditions are met, it could be argued that the conditions no longer apply. The employee is working under a contract of employment, and the employer must give proper notice to terminate it.
Many employers choose to give employees a written contract of employment. Although not essential, this is advisable for these reasons:
- A written contract provides a record of the rights and responsibilities of the employer and the employee, making it less likely that disputes will arise later about what the terms of their relationship are. In particular, the contract can clarify which of the company's policies and procedures, if any, are intended to be part of the employee's contractual terms.
- While an employer does not need to issue an employee with a written contract of employment, it is under a legal obligation to give the employee written information on the main terms and conditions of his or her employment (documenting the contract). If the employer supplies the employee with a written contract containing the necessary details, it meets that obligation.
- Where relevant, a written contract can provide the authorisation needed for certain deductions from the employee's pay (which deductions?).