Farms are unique businesses which present their own rewards and challenges.  One of those challenges are finding good employees, and then managing and retaining those employees.  Many farms are family businesses where the family may not consider that things like employment contracts are all that important, but given the number of disputes (especially estoppel and inheritance claims) there is a clear advantage in letting everyone know where they stand.

It is also common that farmers will have employees who are not members of their families, and who may end up working with them for long periods of time, or may perhaps only undertake seasonal work.

This article aims to address some of the commonly asked questions regarding employing farm workers.

Do you have to provide a contract of employment?

Every employee will have a contract, regardless of whether or not there is a written agreement.  If there is a written agreement, any consideration as to the employees’ terms will start there.  If there is no written agreement, then the contract is likely to be verbal (specifically agreed terms discussed verbally) or implied (either by the law or by the custom of the parties e.g. if there’s a way something has always been done, it’s probably part of the contract).

That being said, there is a requirement to provide a written statement of the key terms and conditions of employment – often called a “section 1 statement” - which includes information about working hours, holidays, pay, notice periods, training entitlements and probationary periods amongst other things.  Since 2020 it has been a requirement to provide this document to all employees and workers on the first day of their employment. Failure to do this could result in Tribunal claims where the employee may receive up to 4 weeks’ pay in compensation.

It is generally a good idea to provide a contract anyway to ensure everyone knows where they stand and to deal with things which can’t be implied, like post-termination restrictions.

What and how should I pay my employees?

All employees should be paid at least minimum wage.  In England currently £10.42 per hour for employees aged over 23.  Agricultural workers in Wales may be entitled to the Agricultural Minimum Wage which depends on their job and ‘grade’. 

Payments should be made via payroll (never in cash) and with the appropriate deductions for tax, national insurance, and pensions deducted. 

How to deal with seasonal work

The nature of farm work – or any work which involves being outside – is that it tends to be seasonal.  Your employees will usually work more hours in the spring and summer months, and fewer hours in the winter.  A well drafted contract of employment can deal with this either by detailing the different hours, or by using annualised hours.

If you’re paying your employees a salary, it is important to ensure that they won’t be earning less than minimum wage at any time throughout the year.  If the summer working hours mean they are earning less than minimum wage, for example, you will need to pay overtime to compensate.  Your employees can report you to HMRC if they are not receiving minimum wage.

You may also need to consider the Working Time Regulations which prescribe a maximum 48 hour working week.  Employees and workers can, however, opt out of this – but only if they choose to do so.

Do I have to provide a pension?

In short, yes.  A soon as your first member of staff starts working for you, you are required to provide a pension.  You must enrol and make an employer’s contribution for all staff who:

• are aged between 22 and the State Pension age

• earn at least £10,000 a year

• normally work in the UK (this includes people who are based in the UK but travel abroad for work)

You staff may opt out of auto-enrolment but only at their own choice.

What holiday do I have to provide?

All employees are entitled to at least 28 days’ holiday a year. including the bank holidays.

Can I prevent holidays during busy periods?

In theory, yes an employer is entitled to dictate when holiday can and can’t be taken but there are complex rules surrounding this and it is important to take advice before imposing such obligations.

If I provide accommodation, can I charge my employee for this?

Yes, but there are prescribed limits on how much can be deducted from an employee’s wages when accommodation is provided. Some employers make the mistake of attributing and deducting more than is allowed where a good level of accommodation is provided with the job. An employer can only deduct the maximum statutory amount for such accommodation, which is £63.70 a week.

You should also be aware that if you provide self-contained accommodation, your staff may be entitled to an agricultural tenancy.  An assured agricultural occupancy starts when the worker has been employed in agriculture (by any employer) for 91 weeks of the last 104, including paid holiday and sick leave, and:

• the tenant works 35 hours or more a week

• the accommodation is owned by the farmer, or arranged by them

if you do not want this, you need to notify your staff at the start of their employment that they have an assured shorthold tenancy.  We would also recommend having an assured shorthold tenancy agreement (an AST) detailing the terms of the tenancy.

Do I have to check if employees have the right to work in the UK?

Whether you are employing someone local or having workers from abroad join you for seasonal work, employers are required to check that each worker has the right to work in the UK. You check right to work by:

• Obtaining original versions of the acceptable documents from the prospective employee (or perform online checks, if applicable)

• Examine the document in the presence of the employee to ensure that it is genuine and to check that it is valid

• Make and retain copies of the documents, along with a record of the date on which the check was made.

Acceptable documents for these checks are listed on the Gov.uk website.

Can I change my employees’ contracts?

Contracts can only be changed where:

• The employer has a specific right to do so; or

• The employee agrees.

Any and all changes must be reasonable and should usually only be implemented following consultation with staff.  It is always recommended to seek professional advice before changing terms and conditions of employment.

If you require any help with employing staff, please contact Charlotte Braham on 01494 893529 or by email.