ACAS Employment Contract Requirements (2025)

What is ACAS?

ACAS (Advisory, Conciliation and Arbitration Service) is an independent public body established in 1975 that provides free and impartial information and advice to employers and employees on workplace relations and employment law. Funded by the Department for Business and Trade, ACAS operates independently to promote good practice in the workplace and help resolve disputes before they reach employment tribunals.

ACAS guidance, while not legally binding in itself, carries significant weight in UK employment law. Employment tribunals regularly refer to ACAS codes of practice and guidance when making decisions, and failure to follow ACAS recommendations can result in increased compensation awards (up to 25% uplift) if you lose a tribunal case. Following ACAS guidelines represents best practice and demonstrates that you've acted reasonably as an employer.

Beyond providing guidance, ACAS offers several free services: a helpline (0300 123 1100) for workplace advice, conciliation services to help resolve disputes without tribunals, training courses on employment law and people management, and extensive online resources including template documents and interactive tools. Their website acas.org.uk is the first port of call for most UK employment law questions.

Legal Requirement: Written Statement of Particulars

Under the Employment Rights Act 1996 (as amended in 2020), all employees and workers must receive a written statement of employment particulars on or before their first day of work. This is a legal obligation, not optional.

Mandatory Information (Day One Requirements)

The following information must be included in the written statement provided on or before the first day of employment:

Additional Requirements (Within 2 Months)

While most information must be provided on day one, the following can be given within 2 months of starting:

• Details of disciplinary and grievance procedures
• Reference to where these procedures can be found
• Details of any other benefits not covered elsewhere

ACAS Guidance on Contract Clarity

ACAS emphasizes that employment contracts should be:

Clear and Unambiguous

Use plain English and avoid legal jargon where possible. Both parties should understand their rights and obligations without needing legal interpretation. Ambiguous terms will be interpreted against the party that wrote them (usually the employer).

Fair and Reasonable

Terms should not be one-sided or unfairly favor the employer. Unreasonable clauses (such as excessive non-compete restrictions) may be unenforceable. ACAS recommends balance and proportionality in all contract terms.

Up to Date

Contracts should reflect current employment law and workplace practices. Employers should review and update contracts regularly, especially when legislation changes. Any changes to existing contracts require employee agreement or proper consultation.

Consistent

Contract terms should align with company policies and procedures. Inconsistencies can create confusion and potential disputes. Ensure handbook policies and contract terms work together coherently.

Specific ACAS Requirements for Different Workers

Zero Hours Contracts

ACAS requires that zero hours contracts must not include exclusivity clauses preventing workers from working elsewhere. Workers must be clearly informed that no minimum hours are guaranteed, and the contract should explain how work is offered and accepted.

Part-Time Workers

Contracts must show how pro-rata calculations work for holiday and other benefits. ACAS emphasizes that part-time workers must not be treated less favorably than full-time colleagues doing comparable work.

Fixed-Term Employees

The contract must clearly state the end date or circumstances under which the contract ends. Fixed-term employees have the same rights as permanent employees and should not be treated less favorably unless objectively justified.

The Historical Context: Why Did the Rules Change in 2020?

The 2020 changes stemmed from Matthew Taylor's independent review of modern working practices, commissioned by the government in 2016 and published in 2017. The Taylor Review highlighted that UK employment law had not kept pace with the changing nature of work, particularly the growth of the gig economy, zero-hours contracts, and agency work. Many workers lacked clarity about their employment status and entitlements.

The Good Work Plan, published in December 2018, set out the government's response to Taylor's recommendations. The resulting legislation (Employment Rights Act 1996 (Amendment of Section 1) Order 2020) extended day-one rights to all workers, not just employees, and significantly expanded the information that must be provided. These reforms recognized that many workers in atypical employment relationships needed the same transparency and protection as traditional employees.

Detailed Breakdown of Day-One Requirements

Let's examine each mandatory element in detail:

Employer and Employee Names

Use full legal names for both parties. For the employer, include the registered company name exactly as it appears at Companies House. If you trade under a different name, include both: "ABC Consulting Limited (trading as XYZ Solutions)." For the employee, use their full legal name as it appears on official documents - this is important for HMRC reporting and pension enrollment.

Start Date and Continuous Employment

The start date is when employment begins - typically the first day the employee attends work or is entitled to pay. Continuous employment date may differ if the employee previously worked for you or a related organization, or if they transferred under TUPE. Continuous employment determines entitlement to various statutory rights (unfair dismissal requires 2 years, redundancy pay requires 2 years, statutory notice increases after 2 years, etc.).

Job Title and Description

The job title should accurately reflect the role's seniority and responsibilities. Avoid inflated titles that could create confusion about status or role. A brief description of work is required - this need not be an exhaustive list of every task, but should give a clear picture of the role's nature and main responsibilities. Many employers cross-reference a separate job description for full details.

Place of Work

State the main place of work by address. If the employee works at multiple locations, state this and identify the employer's address. For mobile workers or those with no fixed location, explain this and give the employer's address. The rise of remote working since 2020 has made this more complex - if someone works from home primarily, state whether this is their contractual place of work or whether they're required to attend the office for meetings.

Pay and Payment Frequency

State the rate of pay (salary or hourly rate) and how often payment is made. Include the payment date - "on or around the last working day of each month" or "weekly on Fridays." If pay varies (commission, piece work, zero hours), explain how it's calculated. You must also include information about any other benefits and whether they're mandatory or discretionary. For zero-hours workers, confirm that no minimum hours are guaranteed.

Hours of Work

Specify normal working hours including days and times. State whether the hours are guaranteed (for example, zero-hours contracts have no guaranteed hours). Include information about overtime - whether it's required, how it's calculated, and whether it's paid. If the worker opts out of the 48-hour weekly limit under Working Time Regulations, this should be documented separately.

Holiday Entitlement

State the annual holiday entitlement in days or weeks. The statutory minimum is 5.6 weeks (28 days for full-time, pro-rated for part-time). State whether bank holidays are included in this figure or additional. Explain how holiday entitlement accrues for those in their first year, and how it's calculated for part-time or irregular hours workers. Include information about carrying over unused holiday if your policy allows this.

Special Requirements for Specific Worker Types

Agency Workers

Agency workers must receive day-one information from the agency (their employer), not from the end-user company where they work. The statement must explain that they're an agency worker, the identity of the end-user, and details of their engagement. After 12 weeks in the same role with the same hirer, agency workers become entitled to the same basic employment conditions as direct employees (the Swedish Derogation no longer applies following 2020 changes).

Apprentices

Apprenticeship agreements must include all standard employment contract information plus details specific to the apprenticeship: the skill, trade or occupation for which the apprentice is training, the framework or standard being followed, the duration of the apprenticeship, and the training provider. The minimum wage for apprentices differs from the standard minimum wage, so this must be clearly stated.

Directors

Company directors may or may not be employees - it depends on their specific relationship with the company. Executive directors with service contracts are typically employees and need written statements. Non-executive directors are usually office holders rather than employees and may not need written statements (though it's good practice to provide letters of appointment). The distinction matters for employment rights and tax treatment.

Updating Existing Employees' Contracts

The 2020 changes didn't automatically update existing employees' contracts. However, if you change any principal statement terms for existing employees, you must provide an updated written statement within one month. Principal statement terms include pay, hours, holidays, sick pay, notice periods, job title, and place of work.

It's good practice to review contracts for existing staff, particularly long-serving employees whose contracts predate the 2020 changes, to ensure everyone has current information. You can't unilaterally impose less favorable terms on existing employees - changes require agreement or proper consultation processes, potentially with redundancy and re-engagement in extreme cases.

What Happens When Contracts and Policies Conflict?

Many employers have written contracts plus separate staff handbooks or policy documents. When these conflict, the contract usually takes precedence for matters it explicitly covers. This can create problems - for example, if your contract guarantees a 35-hour week but your handbook says standard hours are 37.5, you may have to honor the 35 hours.

Best practice is to keep the contract relatively brief and deal with detailed procedures in handbooks, clearly stating that handbook policies are non-contractual and can be changed. For terms you want to keep flexible (like working hours or remote working arrangements), include variation clauses in the contract allowing changes after consultation. Always ensure consistency between your contract and policies - inconsistency benefits the employee when disputes arise.

Penalties and Enforcement

Failure to provide a written statement of particulars can result in employees bringing claims to employment tribunals. If an employee wins any other tribunal claim (unfair dismissal, discrimination, wage claims, etc.) and the employer hadn't provided proper written particulars, the tribunal must award compensation of 2 weeks' pay, and can award up to 4 weeks' pay if they consider the failure aggravated.

Beyond direct penalties, lack of written particulars makes defending tribunal claims much harder. Without clear documentary evidence of agreed terms, it becomes a case of your word against the employee's. Tribunals may accept the employee's version of events if you can't produce written evidence of what was agreed. This alone is reason enough to ensure proper contracts are in place.

HMRC can also penalize employers who fail to provide proper employment particulars if this results in errors with tax, National Insurance, or pension contributions. Additionally, failure to provide written terms could be evidence of poor employment practices generally, leading to increased scrutiny from regulatory bodies.

ACAS Helpline and Support Services

The ACAS helpline (0300 123 1100) is available Monday to Friday, 8am to 6pm. It's free to call and advisors provide impartial guidance on employment rights, contracts, workplace issues, and dispute resolution. While they can't provide legal advice on specific cases, they can explain the law and suggest approaches to resolving issues.

ACAS also offers conciliation services. If an employee submits an employment tribunal claim, ACAS contacts both parties to offer early conciliation. This is a chance to settle the dispute without going to tribunal - around 70% of cases are resolved this way. The conciliator helps both parties reach agreement, often through separate conversations rather than face-to-face meetings.

For proactive employers, ACAS training courses cover topics like handling discipline and grievances, preventing discrimination, managing absence, and recruiting fairly. Many courses are free and delivered online. Investing time in ACAS training helps prevent problems before they become disputes or tribunal claims.

Further Resources

For the most up-to-date guidance, visit the official ACAS website. ACAS also provides a free helpline for employers and employees: 0300 123 1100.