What Happens When an Employee Won’t Sign their Contract

What is a contract of employment?

There is no legal requirement to issue a written contract of employment, there is a legal requirement to issue a Statement of Particulars which is often referred to as the contract of employment.

See our article on what contracts of employment contain for full guidance of what is required.

New Employee Refuses to Sign and Contract

The ideal situation is you issue a contract of employment that is designed to cover the statement of particulars and the contractual terms you need as a business. This should be issued prior to starting employment as you’re asking someone to agree to these terms by accepting employment with you, it’s only right they see the terms before agreeing to them.

If you’ve issued the terms prior to someone starting employment and they refuse to agree to them, then it would appear you don’t have an acceptance to your job offer. It’s best to know this before they start and not go through the process of getting them started.

Having said this, the law only requires you issue a statement of particulars by the end of day one of employment. If you issue the statement or an employment contract at this stage and someone does not wish to sign it you should enter into a conversation as to why.

Fundamentally, if someone continues to come to work, they provide their labour in exchange for their pay and doesn’t raise a specific issue with the contract then it would be deemed they’ve agreed to the contractual terms. We do recommend you send letters chasing a signature and finally a letter saying you’ll consider it agreed to if nothing is raised by a deadline, this helps show you’ve tried to get it signed and they haven’t raised an issue with the contract.

The Reality is a Contract Doesn’t Need to be in Writing

An employment contract is formed when an offer is made and accepted. This does not have to be in writing. We recommend you put the contract into writing, it avoids disputes about what has been agreed, but this isn’t essential in legal terms. Even when it is in writing if custom and practice is different, this could be interpreted as the reality of the contract rather than what is in writing.

So in short, if a contract doesn’t even have to be in writing then it also doesn’t have to be signed.

When things are in writing it’s clear to both parties, it reduces disputes and gives employers something to fall back on when issues arise. We therefore strongly recommend that you issue a contract of employment beyond what is required by the Employment Rights Act 1996 (section 1).

We’ve Issued New Contracts and an Employee is Refusing to Sign

Whether or not the contract is in writing, an employer cannot in most cases unilaterally change terms and conditions. When terms are being changed a period of consultation is needed with a view to reaching an agreement. There are cases where fire and rehire can be used to change terms, however, these are controversial and a proper procedure is needed to avoid an unfair dismissal claim, we recommend taking advice before attempting this.

If you’ve been through a proper procedure with an existing employee to change their contract should still seek written agreement to the change. If the employee continues to work, does not mention they are unhappy with the change and appears to have accepted it then you may be able to deem the contract accepted. A letter chasing the signed contract and then a further letter advising the employee you will treat it as accepted will help to show you have been reasonable.

It is possible for an employee to continue to work under protest, in these cases it is important to continue consultation and seek to reach an agreement.

Due to the risks of possible tribunal claims we recommend you take advice on your specific circumstances especially if you’re looking to change terms and conditions of employment.

Article last updated: 9 June 2022