What does it mean if you have not signed an employment contract?

If you are offered and accept a new job, the next step is that you will usually sign a contract - but what happens if you do not put pen to paper?

An employment contract, or ‘contract of employment’, is an agreement between you and an employer, which sets out your employment rights, responsibilities and duties [1 cited 4.7.22]. These are called the ‘terms' of the contract.

If your job application proves successful then the contract of employment is created as soon as you accept the job offer.

It shows your acceptance of the terms offered, even if they are not expressly clear [2 cited 4.7.22]

Despite the obvious importance of a contract of employment it is not unusual to find employees, in many different professions, who have not actually signed one.

It can often occur if an employer does not have a dedicated HR department or advisor [3 cited 4.7.22]

Understanding exactly what it means if you refuse to sign, or never got around to signing your contract of employment is important.

Essentially the contract does not have to be signed for it to be effective.

But it is wrong to think that just because you never signed the document, you are not bound by it and you do not have to adhere to the terms and conditions of the agreement.

Although you may not have signed a written contract, it does not mean you can simply ignore any previous agreement made.

From the moment you start work for an employer it effectively signifies you are fully aware of the terms and conditions of employment and that, crucially, you accept them.

The contract of employment comprises of two types of contractual terms. These are express terms, and implied terms.

Express terms

• Are terms in the contract of employment which have been agreed upon between employee and employer. These can include: how much you will get paid, your hours of work, holiday pay, sick pay and notice period.

You will also discover express terms of a contract of employment in the job advertisement, a written statement of the terms and conditions, anything you signed when you started working and the employee handbook.

Implied terms

• Do not necessarily have to be written down, but they still form an important part of the agreement between you and the employer.

They include terms that might be obvious to both parties such as a duty of trust e.g. you will be honest and not steal, that you will follow any reasonable instructions and a duty of care in that your employer will provide a safe working environment.

Custom and practice is a way in which a practice or benefit can constitute an implied term of a contract of employment. The example given by ACAS is, an employee could expect a Christmas bonus of £100 this year if their employer has paid that annually for the last 10 years, to everyone in their team [4 cited 4.7.22]

A practice or benefit will become an implied term of the employment contract if it is regularly adopted and is customary in a particular trade or locality or at a particular workplace.

Although you do not have to sign a contract of employment, it is always a good idea to have everything in writing. As with any type of relationship, the working relationship may not always run smoothly.

It also helps if your employer seeks to make any changes to your terms and conditions, which can happen.

A contract of employment is a legal agreement and its terms cannot lawfully be changed without agreement from you (either individually or through a recognised trade union) [5 cited 4.7.22]

In such situations it is always useful to be able to refer back to a signed contract. Especially if you consider the proposed changes to be a significant change to the contract and unacceptable.