Advice on common farm employment issues

From correctly issuing employment contracts to having the right paperwork in order, getting staffing right from the very start will not only rule out problems further down the line but can also protect the business from potential claims.

Employment solicitor Emily Hand, who works in the agriculture sector team at Wilkin Chapman, an NFU legal panel firm, says there are some issues that commonly arise in farming that can easily be avoided.

She gives her advice on five of these areas.

See also: Employment law changes 2024 – what farmers need to be aware of

Get contracts right to reflect seasonal nature of work

Agriculture’s seasonality means a fluctuating workload, and managing that can be tricky.

To address seasonal variations, agricultural businesses can directly hire workers or instruct contractors to carry out what is needed.

For direct hires for seasonal work, there are two options – zero-hour or fixed-term contracts.

A zero-hour contract allows an individual to be employed year round without guaranteed hours.

While these offer flexibility, issues can arise as workers have the right to refuse to work the hours offered to them.

“A worker can pick and choose the hours they work from what they are offered, so there is nothing to stop them turning down the hours that the farmer needs them for,” says Emily.

Fixed-term contracts can be a solution to riding the peaks and troughs of the farming calendar as they allow staff to be hired for a specific time period, for example a four-month contract from June to September, with guaranteed hours.

However, farm businesses come unstuck when they don’t end the contract, allowing the work to extend beyond the termination date.

“A fixed-term contract needs an end date and not only that, the work actually has to end so you shouldn’t have a situation where the contract ends on a Friday and the worker turns up on the farm the following Monday and is given work,” advises Emily.

This is because it then becomes a rolling contract, creating issues around letting that member of staff go when they are no longer needed, for example with a claim for holiday pay.

Although a letter of termination would be given in a situation when the contract has a notice period built in, fixed-term contracts normally have an end date so it is simply a matter of sticking to the employment ending on that date.

Fixed-term contracts are not without their downsides as there is a financial cost to recruiting every year, and it can leave farmers short of workers when they need them the most.

© Adobe Stock

Ensure accurate record-keeping on holiday pay

Frequent changes to holiday pay regulations, especially for workers with irregular hours, can cause confusion.

Farmworkers who do not have guaranteed hours of work in their contract of employment or whose contractual hours in each pay period are wholly or mostly variable are classed as irregular workers.

Proper holiday pay calculations are crucial in order to avoid costly disputes or employment tribunal claims, says Emily.

Since 1 April 2024, holiday accrual for irregular workers and part-year workers is calculated in hours, at 12.07% of the hours they work in a pay period.

Businesses have two options for managing holiday pay in these circumstances.

“They can either accrue and pay holiday as it is taken, based on a week’s pay per week of holiday, or include holiday pay in regular wages, known as rolled-up holiday pay, at the same rate of 12.07%,” Emily explains.

“Both approaches require accurate record-keeping to ensure compliance.”

The amount of 12.07% is based on the statutory minimum holiday entitlement of 5.6 weeks.

If a worker’s contract gives them more holiday than the statutory minimum, their employer will need to adjust the percentage. 

Keep up with health and safety obligations

All businesses need to have a robust health and safety policy and procedures in place, clearly setting out safe practices to prevent accidents.

Proper training is important, so too is having the paperwork to back it up.

“If you have trained a worker in how to do a specific task, for example operating a telehandler, you need the paperwork to demonstrate this because, should the worst case scenario happen, it will be needed as proof that that employee was adequately trained, and that you have supported them in that role,” says Emily.

The employer will also need to prove that there was a specific health and safety procedure in place that the worker was aware of because, for example, you gave them a copy it.

This will mitigate possible financial losses to the business should an accident happen, but the aim should be to prevent an accident occurring in the first place.

“There is a cost to the business of sick pay if an employee is injured, if the worker is entitled to it, and then there is the possible litigation cost with the loss of earnings included in a personal injury claim on top of a payout for the injury,” she says.

In addition, the stress caused by an accident is likely to affect the whole team and their families.

Having the right insurance policies in place will also ensure the business is financially covered in the event of a personal injury claim.

Ensure the correct agreement is in place for worker accommodation

If a farm business provides accommodation for an employee and does not follow the correct statutory procedure before the worker moves in, the worker could gain the right to continue living in the accommodation after their employment has ended.

In some cases, a member of a former worker’s family could also acquire rights to remain in the accommodation after the worker’s death. 

The procedure and the rights of workers differ across England, Wales and Scotland.

“Many farm businesses still believe that when a tenant is someone who works on the farm a written agreement is not necessary, or indeed they enter into the wrong type of tenancy agreement, and this can become an issue when that employment ceases,” says Emily Hand.

© Adobe Stock

Obligatory written contract of employment

Contracts of employment must be issued on or before an individual’s first day of employment, but Emily says it is not uncommon in farming (especially when the same families have worked on a farm for generations) for no written contract to exist.

That makes it very difficult to pinpoint exactly when the individual started working on the farm, and what the actual terms of their employment are.

So it is always better to issue a written contract late rather than not at all, says Emily.

However, this becomes trickier when an employee has been working on the farm for a number of years, and especially if the employer wants to alter the terms.

“If an employee has been working set hours on set days, with an hour’s lunch break, has been paid so much an hour, and has taken X number of days holidays a year, the employer can’t then present them with a paper copy of a contract altering those terms, because it is changing the original terms.”

This is because even when there is no written contract, there is in law a contract in place based on custom and practice.

“It doesn’t mean it is impossible to change the terms, but the employer must consult with the employee,” says Emily.

“The employer must justify why the changes are necessary and ultimately come to an agreement with their worker on the contract, and get a signed copy in place.”

When there is no contract of employment, a worker can claim for this breach but it can only be brought to an employment tribunal alongside another “substantial” claim.

“If someone brings a claim for unfair dismissal, discrimination or unlawful deduction of wages, for example, and they have never had a contract, they are eligible for additional compensation for that oversight,” Emily explains.

If any employment claim is brought, it is difficult for the employer to prove the terms of the contract if nothing has been written up, such as hours worked and holiday entitlement.