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Is it necessary for an employment contract to be signed?

12 January 2022

An employment contract need not be in writing, and may be express or implied; so there is no strict requirement for a contract to be signed. However, it is clearly in the employer's interests to obtain a signed agreement, otherwise it may be difficult to establish what the terms are and there may be disputes. It may be inferred that an employee has accepted the terms offered by the employer by their conduct (in effect by turning up for work), even if the contract has not been signed and returned by the employee.

However, a court or tribunal may not always be prepared to infer consent to particular terms from the employee's performance of the contract. This is particularly true where an existing employee is offered new terms and their consent to a particular term cannot be inferred from the employee continuing to perform the contract, for example because the relevant term does not have immediate practical impact. An example of this is a restrictive covenant. If the new contract contains restrictive covenants, an employer will usually find it difficult to establish that these were particular terms of the contract that had been agreed between the parties, without the employee's signed agreement. The test is whether "the employee's conduct, by continuing to work, [is] only referable to his having accepted the new terms imposed by the employer", or whether it is "consistent with the old contract continuing" (Elias J in Solectron Scotland Ltd v Roper & Ors [2003] UKEAT/0305/03). For an unusual example of a case in which the court found that there had been implied acceptance of new restrictive covenants, despite the lack of a signed agreement.

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