Some people don’t read the fine print, and some people don’t read the whole employment contract. Understandably, sometimes people could be desperate to get into a job or their dream line of work- while this is expected, it doesn’t make it safe. Employment contracts are legally binding papers that define the exact relationship between the employee and the employer. All of an employee’s rights and responsibilities are mentioned in detail in very clear language. The terms of employment contracts may sound intuitive once read, but they’re actually very hard to craft and to negotiate.
An employment contract is the protective legal armor for both parties, the employer and the employee. To provide the fairest treatment to your employees and leave no loopholes open for devious legal attempts, you’ll have to make sure that your employment contract is watertight. This can be considered a guide to help you map your thoughts and provide a little legal guidance.
Statutory Written Statements and Rights
Every state or country may have different statutory employment rights, what they all share in common is that every workforce, except for self-employed employees, in the country should abide by them. An employed has to legally provide a written statement of the conditions of employment of most employees within the first 2 months after hiring. These rights are considered the minimum rights that a country believes any employee should have. The statement must include the name of the employee and employer, date of employment, job location, the wage (should be or exceed the national minimum wage), and other details that affect the conditions of the agreement. Keep in mind that that written statement is not the same as the contract, it’s considered the employer’s version of the agreement which transcribed with the employee.
At-will agreement or employment is a term most commonly used in the US. It’s a statement that confirms that the employee is employed at-will, that they can leave at any time, and also can be fired for any reason. The world can be seen as divided into two halves concerning the employment agreement. The USA uses the at-will policy while the rest of the world adopts a for-cause policy where the employer can only fire an employee for grave misconduct without any repercussions.
The Three Nons
Non-disclosure, non-solicitation, and non-competes are the most important agreements with companies that deal with sensitive information like payment, research and development, and proprietary information. Even a small business should always include the three into their contracts or as separate agreements.
A non-disclosure agreement (NDA) is the type of agreement you’d want to use to keep information undisclosed out of a safe and certain corporate or business hierarchy. It legally binds the employee not to disclose certain information about the employer, employees, and clients. The NDA is one of the few agreements that remain in effect even after an employee has left the company, and it’s also legally viable in lawsuits. A non-solicitation agreement (NSA) is usually coupled with NDA. It stops employees from taking clients away from the company for their own business gains; it’s pretty common in most industries. A non-compete agreement can stop employees from competing with the company for a certain duration and from opening a shop within a certain radius of the company.
Lawsuits are very draining of resources and time; employers tend to avoid them unless it’s a necessity. Experts at Boyd Legal recommend consulting with your business lawyer before employment to help you get familiar with local laws and how they can affect your business. You’ll want to protect your business by ensuring your contract is well-written and leaves no room for it to come back and damage you. The best way to do this is to include in every employment agreement a condition that disputes are to be resolved by mandatory arbitration. It basically means that you and the employee will not legally sue each other and instead resort to an arbitrator that can resolve the dispute. The employee has to agree on the conditions for it to be valid except for the three nons, where an employer can deem suing as necessary to enforce them.
Employment manual is an extensive collection of all the company’s guidelines of work. It was usually done by big companies with a lot of employees, but nowadays, thanks to technology, a lot of small businesses also use them. The employment manual can be treated as an extension of the terms and conditions or not, depending on what’s stated in the employment agreement. The common practice is to state that the employment manual is only a set of guidelines that may intersect with the employment agreement but is not binding.
The employment contract is one of the few things that should never be rushed into making. This isn’t an exhaustive list of all the variations and local laws; you’ll want to have legal consultation to guide you through the creation of the contract.