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Section 1 Statements

The Employment Appeal Tribunal in the case of Stefanko and others v Maritime Hotel Ltd has considered whether employees have a right to receive a statement of employment particulars when they have been employed for less than two months.

The Law

Under section 1 of the Employment Rights Act 1996, employers are obliged to provide employees who have been employed for one month or more with a written statement of particulars of employment (including certain details such as pay, hours of work and holiday entitlement). This statement must be given to the employee within two months of the start of their employment.

If an employee brings a successful employment tribunal claim, which includes a claim for failure to provide a statement of particulars, the tribunal can award a minimum of two weeks’ pay and up to 4 weeks’ pay as compensation.

Background

The three Claimants were employed by Maritime Hotel Ltd (“the Hotel”) as waiting staff. They were dismissed from the Hotel after complaining about shortfalls in wages and the Hotel failing to provide payslips and section 1 statements of employment particulars. They brought successful claims for automatic unfair dismissal on the grounds of asserting a statutory right. They also brought a “piggy-back” claim for breach of section 1.

Two of the Claimants, who had been employed for more than two months, were awarded 4 weeks’ pay in respect of the failure to provide a section 1 statement. However, the Employment Tribunal held that one of the Claimants, who had been employed for only 6 weeks, was not entitled to compensation for failure to provide a section 1 statement as the Hotel had two months to provide this.

That Claimant appealed.

Decision

The Employment Appeal Tribunal (“EAT”) decided to reverse the Employment Tribunal’s decision. It held that all employees who have been employed for a month or more have a right to a section 1 statement even if their employment ends before two months have passed. The Claimant was therefore awarded to 4 weeks’ pay as compensation.

Comment

Best practice is to provide employees with section 1 statements of employment as soon as possible to clearly set out the main contractual terms. It is important to note that from April 2020, all new staff (including “workers” who are not currently covered) will have the right to receive a section 1 statement from day 1 of their employment.

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