Agricultural Employment Contracts

With harvest well underway, many farm businesses will be boosting their workforce by taking on temporary staff, or contracting individuals. 

This flexibility is a vital part of the farming year – but increasingly complex employment rules, and the prospect of curbs on zero hours contracts announced in the King’s speech, means that increasing care needs to be taken in order not to fall foul of employment law.

Seasonal agricultural workers come in various guises, from fully incorporated personal service companies through self-employed sole traders, to directly employed workers on temporary or zero-hours contracts.  A primary consideration is to understand on what basis you are taking on your extra workers.

For those who are operating through limited companies, the situation is relatively simple: the work is undertaken at a fixed rate, and considerations such as holiday pay are the responsibility of the contractor.  However, the IR35 rules (which determine whether a worker is actually an employee) can come into play, so it is important to take expert advice if you are unsure of their status.

Many agricultural businesses take on individuals directly as seasonal workers, whether on a fixed-term contract or on a zero-hours contract (more about this later).

The importance of a written statement of terms

This can be an useful and flexible way of dealing with the seasonal fluctuation in business.  But because these workers will only be working for a finite period of time, there can be a temptation to treat them differently from more permanent staff, right down to omitting to give them a written statement of particulars detailing key terms and conditions.

This is especially true in smaller businesses (prevalent in the farming sector), which do not enjoy the luxury of an in-house HR department.

But not giving every individual – even temporary and seasonal workers – a written statement of terms and conditions of employment is a big mistake, and one which could land employers in a whole lot of trouble. 

First of all, it is a legal requirement to provide every worker/employee with a written statement of employment particulars, of which the ‘principal statement’ detailing the main terms and conditions of employment must be provided from the first day of their employment.  This is a legally binding agreement that contains prescribed information and outlines the main terms and conditions between employer and worker/employee.

An employment contract is a much wider document, which contains enhanced terms and conditions of employment, and offers businesses greater flexibility and protection.  It is important for this document to be carefully drafted so that the employment status (worker vs employee) and relationship with the individual is clearly defined and reflects what happens in practice.

Certain aspects of employment contracts are governed by UK law, such as minimum wage, working time regulations, and discrimination rules.  Other legislation provides a framework for legal rights and obligations, such as the Employment Rights Act 1996, which covers areas such as unfair dismissal, redundancy pay and maternity rights, and the Equality Act 2010, which protects against discrimination in the workplace.

Understanding these legal requirements is essential to ensure compliance and avoid potential legal consequences.

Setting boundaries

But it’s not just about meeting your legal obligations: a well-drafted employment contract can help protect your business by setting clear boundaries and expectations for your employees.  It can deter potential conflicts and disputes by ensuring that both parties are on the same page about the terms of employment.

For employers, the contract can help protect their business interests, with provisions to protect confidential business information, intellectual property rights and client relationships, as well as providing a mechanism for addressing performance issues, enforcing disciplinary procedures, and if necessary terminating the employment in a way that complies with UK law.

For employees, it ensures that they are treated fairly and in accordance with the law, safeguarding their rights to fair pay, safe working conditions, and protection from discrimination or harassment.  It also provides a clear outline of their job responsibilities and expectations, reducing the risk of disputes over job performance.

To ensure legal clarity and comprehensive protection, an employment contract should include several key components such as:

• Job information: job title, job description, location of work

• Remuneration: salary or wages, bonuses and other benefits

• Working hours: standard hours, overtime policies, break allowances

• Termination terms: details about notice periods and grounds for dismissal

• Confidentiality and non-disclosure: provisions to protect sensitive business information

• Grievance and disciplinary: the process for raising issues or complaints, and how disciplinary matters will be handled

• Leave entitlement: annual leave, sick leave, maternity and paternity leave

Even for seasonal and temporary workers, providing a clear, well-written contract on day one is an absolute must.  By ensuring all the relevant components are included, both employers and employees/workers can foster a transparent, respectful and legally compliant working relationship – and that is the best way to ensure the maximum benefit to your business form all staff.

Zero-hours contracts and the new Employment Rights Bill

The King’s speech in July set out the proposed new Employment Rights Bill.  Whilst we don’t yet know the detail of this legislation, its purpose is to ‘ban exploitative practices and enhance employment rights’ 

This is likely to include giving all workers full rights such as parental leave, sick pay and protection from unfair dismissal from day one, making flexible working the default from day one, and – importantly – banning ‘exploitative’ zero-hours contracts.

That word ‘exploitative’ is the crux of the matter, and it hasn’t been defined yet.  But the Bill does represent a step back from banning zero-hour contracts entirely (which was mooted by some in the run-up to the General Election), and is a recognition that the flexibility such contracts offer both employers and employees can be beneficial to both.

The devil will be in the detail, but it seems likely that zero-hours contracts will still be allowed where it can be demonstrated that they are beneficial to employees as well as employers; for many working in the agricultural sector, this is indeed the case.