The answer is yes they do, as soon as someone accepts your job offer there is a contract between employer and employee even if you haven’t put anything in writing.

A verbal contract (particularly where the employee has already done some work in return for pay) will be equally binding – though it may be more difficult to prove what the precise terms of the contract are.

You are, however legally required to give every employee a written statement covering specified terms and conditions, within two months of the employment beginning. This should include:

• You must include: the employer’s name and the name of the employee
• the date on which the employment began
• the date on which the period of ‘continuous employment’ began (if, for example, the employee previously worked for a company acquired by you)
• pay (or how it is calculated) and when it will be paid
• information about working hours
• entitlement to holidays and holiday pay
• the employee’s job title or a brief description of their work
• the employee’s place of work
• details of disciplinary, dismissal and grievance rules and procedures

Make sure that you have written evidence of any other important contract terms too. Do not leave things to chance, or you might regret it later. If you don’t provide the terms of employment in writing an Employment Tribunal may decide the terms under which the employee is working. In addition, you may have to pay the employee compensation of 2 -4 weeks pay. 

Now read part 2: The Employee Contract – Does it say what you want it to say?