The Contract of Employment (SQA National 5 Business Management): Revision Note
Exam code: X810 75
The role of employment contracts
An employment contract is a legal agreement between an employer and an employee
It sets out the terms and conditions of employment, explaining what the employee will do, what they will be paid and what both sides can expect
Contracts can be written, verbal, or implied, but written contracts help avoid confusion and disputes
What does a contract of employment include?
Job title and duties
What the employee is expected to do at work
Hours of work
Full-time, part-time, shift patterns or flexible hours
Pay and benefits
Wages, bonuses and overtime rates the employee will receive
Holiday entitlement
How many days of paid leave the employee is allowed each year.
Notice period
How much warning is needed if either side ends the contract
Start date
When employment begins (and ends, if temporary)
Disciplinary and grievance procedures may also be included in the contract of employment
Why are employment contracts important?
For employees | For employers |
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Examiner Tips and Tricks
A common mistake is thinking a contract only benefits the employer. It actually safeguards both sides. It gives employees security and outlines what’s expected from each party
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