Employers frequently ask whether an employment contract is legally binding if it was never signed. Whether an employer wishes to use an unsigned contract to support or quash a claim, the position is the same - an employment contract does not have to be signed by both parties for it to be legally binding. This is evidenced in a number of ways.

The Legislation

There is no specific legal requirement for employment contracts to be signed in order to be enforceable, as there is no legal requirement to have a written employment contract in the first place. Employment terms can come in the form of an express, implied, written or oral agreement, as well as any statutory entitlements.

However, Article 33 of The Employment Rights (Northern Ireland) Order 1996 states that an employer must provide an employee with a written statement of the particulars of employment no later than 2 months after work has commenced. The statement may simply reflect what has already been orally agreed between the parties. Employers often reflect this in the terms of a wider contract, but there is no explicit legal requirement for the employee to sign off on any written statements provided to them by an employer.

Contract Acceptance in Practice

An employee can accept the terms of their contract orally, or impliedly through their conduct. This means that an employee accepts the terms of their employment by continuously turning up to work each day, even if they haven’t signed or returned their contract. This was made clear in the case of Wess v Science Museum Group UKEAT/0120/14/DM. Mrs Wess was issued with a new contract which decreased her termination notice period from 6 months to twelve weeks. The employment tribunal ruled that Mrs Wess had accepted the terms of her new contract by continuing to work for 9 years post-change, and because she had not protested about the material amendment, but had in fact expressed disagreement with other terms.

The case of Collymore v Capita Business Services Ltd UKEAT/162/98 shows how contractual terms can still be impliedly accepted through conduct, even where an employee has contested the terms. Mr Collymore objected to the inclusion of a 6-month probationary period in his terms of employment. The tribunal sided in favour with his employer, who had advised Mr Collymore that he would have to accept all other contractual terms in writing if he wanted the probationary period to be excluded. Mr Collymore did not provide written acceptance and continued to work, thereby impliedly accepting all contractual terms.

However, there is an exception to the above rule when it comes to new contracts which include restrictive covenants. An employer may find it difficult to establish that the restrictive covenants were agreed terms between the parties, without the employee's signed agreement. Employers should bear in mind the test in Solectron Scotland Ltd v Roper & Ors [2003] UKEAT/0305/03 -  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". New covenants put in place after the employment has commenced will rarely be upheld without proof of sign off.

Conclusion

Employers can rely on contracts that are unsigned, if they can show the terms have otherwise been accepted orally or by conduct. However, special caution is required where any new restrictive covenants are introduced and getting sign off on these is the only guarantee that an employer can rely on them. Despite the legal position on unsigned contracts, it would be in the interests of both parties to obtain a signed agreement in order to promote clarity and avoid disputes.