An Employment Contract is a contract - either written or verbal - which sets out the terms and conditions for employment between an employee and an employer. LawDepot provides a written Employment Contract.
Why won't an oral Employment Contract be sufficient for me?
What is addressed in an Employment Contract?
What are the duties of the employee?
How much annual leave is the employee entitled to receive?
How can an employer protect work product and other confidential information?
What geographic restrictions can the employer make in the non-competition clause?
the responsibilities of the employee and employer.
whether there are limitations on the employee's ability to compete with the employer's business upon the employee's termination.
The duties of the employee refer to the tasks that will be performed or the functions and responsibilities of the job position. Ensure that your description of the employee's duties is clear. You should review your description and make sure that it is grammatically correct within the context of the document.
A probationary period is a limited period of time after the employee commences work during which either party has the right to terminate the agreement. In some jurisdictions, termination can occur without notice or compensation (other than wages owed for hours of work already completed). Many employers require their employees to successfully complete a probationary period before offering them a longer term position.
Most full-time workers receive four weeks annual leave for every 12 months worked. Part-time employees are entitled to four weeks annual leave but paid on a pro rata basis. Casual workers generally do not receive annual leave. To compensate, they are paid a loading on top of their normal rate of pay.
Notice refers to a period of time prior to termination of the employment contract. The purpose of notice is to allow the employee to find other employment or the employer to find a replacement employee. In most jurisdictions, the law requires employers to give employees a notice period (or pay in lieu of notice) before termination. Typically, the length of the minimum notice period required by law depends on the length of the employment relationship. In some circumstances the employer may terminate the employee without notice if there is sufficient "cause". In most jurisdictions if one's employment is terminated with cause, there is no requirement on the part of the employer to provide notice or pay in lieu of notice. However, the employer must ensure that the reason for termination is properly communicated at the time of termination. Some examples of cause are dishonesty, disloyalty, insubordination, lateness/absenteeism, disruption of business of affairs, alcohol or drug use, incompetence, neglect of duty, criminal or immoral conduct and sexual harassment. Note that the employer may have to prove to a court (or other tribunal) that there was sufficient cause for termination.
An employer can protect his/her confidential information by inserting a clause that says all confidential information including work product belongs to the employer. This clause is automatic in LawDepot's U.S. and Canadian forms. To insert this clause in the United Kingdom or Australia, simply check the box "Confidential information" under the heading "Optional Clauses for More Complex Contracts." The document will then state that all confidential information including work product belongs to the employer. LawDepot's Employment Contract broadly defines "confidential information" to protect everything from trade secrets to customer lists.
A non-competition clause prevents the employee from unfairly competing with the employer after the employment is terminated. This means that when the employee's employment comes to an end, he or she cannot take a job at a business which is in direct competition with the employer. A non-solicitation clause prevents the employee from inducing other employees or contractors from leaving the employer or from interfering with the employer's relationship with other employees in general. This means that the employee cannot invite the employer's other employees to move with him or her to another workplace.
You can only prevent an employee from engaging in a business that competes with your business within a geographic area large enough to protect your business. The restriction must be reasonable so that the employee is not restricted from engaging in his or her usual trade in an area that could not affect your business (e.g. 25 km from the employer's place of business).
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