Employment Agreement Adjustments in the UK

PTO, notice periods, bonuses, and more.

Updated on March 14th, 2023

Can we adjust paid time off (PTO)?

Yes. Paid time off (PTO) can be adjusted if it is not at odds with the United Kingdom’s statutory labor requirements (e.g., adjusting PTO to a figure less than the statutory minimum annual leave requirement).

Can we remove the notice period?

Any supported employee who has completed at least one month of service is entitled to statutory minimum notice periods. Only in cases of gross misconduct can the notice period be disregarded. Nevertheless, an agreement cannot include a clause stating that there will not be a notice period.

Can we remove, increase, or extend the probationary period?

You may increase or extend probationary periods. However, there is no general requirement to include a probationary period.

Can we add commissions, bonuses, or ad hoc payroll items?

Bonuses can be stipulated within the employment agreement, subject to both a completed Variable Compensation Agreement and a confirmed variable type (either guaranteed or subject to specific metrics). Discretionary bonuses can simply be stipulated within the employment agreement alone.

How can we offer equity or stocks to our supported employees?

In the U.K., we offer you the option of issuing equity as either “nonemployee” or “employee” grants.

Irrespective of the equity issuance type (i.e., nonemployee or employee grants), we facilitate withholding, payroll reporting, and other equity compliance requirements.

How can we offer equity without signing a direct agreement between our supported employee and us?

We require you to directly issue the grant notice (i.e., side agreement) to your supported employee. This side agreement should not include any language that indicates a direct employer or employee relationship between you and your supported employee.