Section 1 of the Employment Rights Act 1996 requires employers to provide employees with a written statement of their terms of employment within two months of starting work. Section 38 of the Employment Act 2002 allows tribunals to increase compensation in many employment claims (such as unfair dismissal and unlawful deduction from wages) if the employer is in breach of section 1 when the claim is lodged.
In Govdata v Denton, the employee was employed by Govdata from December 2015 but was not given a section 1 statement until 15 June 2016. His employment ended in August 2016. He brought numerous claims including unlawful deduction from wages and breach of section 1. The employment tribunal upheld those claims and awarded compensation. The employee asked the tribunal to increase the award because of the breach of section 1, which the tribunal did. The employer appealed.
The Employment Appeal Tribunal said that an award can be increased under section 38 only if the employer is still in breach of section 1 by the time proceedings start. The employer had been in breach of section 1 for 18 months but had complied by the time the employee lodged his claim. There could be no increase in compensation.
The employer in this case sorted the employee’s section 1 statement just in time. From April 2020, both workers and employees will have the right to a section 1 statement from day 1. Employers should start planning for this change now.