The biggest benefit for any business in providing each member of staff with a written contract is ultimately its usefulness in helping to avoid disputes.

Contracts need to be clear, unambiguous and sufficiently detailed to help ensure that any disagreements can be easily resolved without recourse to a tribunal. In order to safeguard your business, the terms and conditions you wish staff to be bound by must be agreed in writing.

You are legally required to provide a written statement of the key terms of employment such as hours of work, pay, holiday entitlement, notice periods and so on to each new employee within two months of their starting work. Such a statement is not a contract but is evidence of the terms as seen by the employer. A written statement will provide only limited protection in the long-run, investing in an expertly drafted contact which deals with a much wider range of issues will help you handle more complex employment problems. For example, an employee's duty of confidentiality, terms governing expenses, dress codes, company mobile phones, and restrictive covenants drafted to prevent a former employee soliciting customers are invaluable contract clauses. It is also possible to build in a degree of flexibility so contractual changes can be made as your business develops.

Contracts of employment do not have to be fair or reasonable as the courts have a duty to enforce the terms as agreed. However, to secure long-lasting and smooth relations with staff it is advisable to offer employment on terms and conditions that are not too onerous or one-sided. Inevitably you want to attract and retain the very best people and you should therefore seek to encourage and motivate staff by providing a balanced contract which takes into the account the needs of both parties and arrives at an agreeable compromise.