1. Working Arrangements: Contracts of Employment BTEC First in Business

2. Objectives To understand the basis of employment contracts agreed between employers & employees To understand the importance of flexibility and why working arrangements may need to change To understand what effects change may have on the business

3. Employment Contracts By law, employees are entitled to an employment contract This is a FORMAL agreement which outlines the TERMS & CONDITIONS of the job Employers and employees have to have to obey these terms and conditions – it is unlawful to break them without both parties agreeing

4. Terms & Conditions TERMS & CONDITIONS The number of hours the employee is expected to work The type of employment; Full or part time? The pay and benefits provided to the employee by the employer The place the employee will work

5. In more detail … The place of work This could be the company ’ s building, offices, shop, factory etc. Some employees work from home – Shop owners, farmers, teleworkers Mobile workers – Move from place to place (e.g. sales rep, a personal trainer etc)

6. In more detail … Types of Employment 1 Permanent employment – No limit on length of time a worker is employed for – They work for a business until they leave Possible reasons for leaving – To move to another job – If they break their contract of employment – If they are made redundant – Retirement

7. In more detail … Types of Employment 2 Temporary employment – Employees are employed for a limited period Why do businesses have temporary staff? – To cover busy periods Shops during Christmas Farmers during harvest – To cover for absent staff Maternity leaver, long-term illness – To carry out a “ one off ” task Installing a computer system

8. In more detail … Full & Part-time work Full time – People who work the full working week of a business. – The EU Working Time Directive suggests it should be no more than 48 hours per week Part time – People who work only a proportion of the working week (e.g. less than 30 hours) – They give the company flexibility

9. In more detail … Hours of work It is not only whether somebody is Full-time or Part- time that dictates how many hours they work: – Shift work e.g. 8am-4pm, 4pm-12am, 12am-8am Usually 24hour businesses/services – Flexitime – they have to work an agreed number of hours per month, but can work at any time during the day – Overtime – When businesses want their employees to work more hours than agreed in their employment contract Usually have to be paid a higher hourly rate – Breaks – By law, employees are entitled to breaks during their work. Either days off, number of hours per working day

10. In more detail … Pay A contract of employment states the rate of pay whether it is a salary or a wage: – Wage – paid weekly/monthly, by the hour e.g. £ 5ph – Salary – paid monthly, shown as an annual salary figure e.g. £ 20,000p.a. The contract may also include bonuses or commission – A bonus is the amount paid if a target is reaches – Commission is an amount paid to each employee for every item/service they sell

11. In more detail … Benefits The benefits offered by the organisation are also included in the employment contract These can include – The number of days of paid holiday – Private health care – Insurance – Company car

12. How can changes in the contract affect both the employer and employee? Tonight you need to work an extra 4 hours so that we can get that order in on time I have a letter saying that my working hours are 9am-5.30pm. It also says that I will be guaranteed overtime if I work outside those hours.