In the contemporary world, most companies and businesses ask their new employees to sign an employment contract agreement before getting employed. These agreements are not only important for the employers but for the employees as well. They help establish a conducive working environment as well as strengthen the relationship between the employer and the staff. Besides, the employment contract agreement helps in spelling out important guidelines and policies to ensure the company/business run as anticipated. Therefore, before you get into any kind of employment engagements, it’s important that you first sign the Employment Contract Agreement.
Defining Employment Contract Agreement
An employment contract agreement is simply an official agreement that binds the employer and the employee to adhere to the set terms and conditions of a contract. Usually, the agreement highlights some of the rights, responsibilities, and work hours, rate of pay, and obligations of the employee and the company during the work period. Once signed, the employment contract agreement will act as a reference point while settling disputes or workplace misbehaviors.
Why is the Employment Contract Agreement so important?
Well, if you are about to hire a new employee, it’s very important that you consider signing the employment contract agreement. The following are some of the reasons why you need to sign one:
- Protection of Trade Secrets
There are some job positions that are associated with delicate and confidential information about the organization. Therefore, in order to protect such proprietary information, it’s important that you sign an agreement with the new employee at the beginning of their contractual agreement. In the employment contract agreement, you can state various information or materials that you wouldn’t want to disclose to outsiders.
- Protects Copyrighting
During the contract, the employee may engage in various projects or even come up with some unique creations and ideas. In order to protect the work created during this contractual period, the company/employer may want to own such creations as its property. Therefore, the employment contract agreement may create a clause that assumes and protects the ownership of inventions made by the employer under contract.
- Job Security
An employment contract agreement can benefit both the employer and the employee in various measures. For instance, the agreement protects the employee from being sucked by the employer anyhow. Until the contract period ends, the employer doesn’t have the right to terminate employment. On the other hand, the employer can’t lose a key or executive employee. For example, there are some employees with special skills that are difficult to get a replacement. Therefore, an employment contract agreement benefits the employer in that such employees can’t quit suddenly until their contract period expires.
- Dispute Resolution
An employment contract agreement help in minimizing the occurrences of workplace disputes should they occur. Also, it prevents both the employer and the employee from engaging in expensive and time-consuming court battles.
What to Include in an Employment Contract Agreement
Oftentimes, a typical employment contract agreement contains the following information:
Terms of service
The contractual agreement often highlights the nature of or period of employment. In other words, it clearly identifies whether the employment is temporary or permanent. If temporary, the document will clearly indicate the duration of employment. If it’s permanent, the agreement will highlight the probationary period by which the employee will work before being employed permanently.
Other than the terms of service, the employment contract agreement also addresses various conditions that may evoke employees’ dismissal before completing the contract period. With this in mind, the employee will always restrict themselves from behaviors that are prohibited. However, it is important for an employer to consult termination jurisdiction before applying it.
Duties and obligations
Among other things, the employment contract agreement should state in detail the specific duties, roles, and obligations an employee is expected to conduct during the contract.
Benefits and compensations
This basically refers to salaries, wages, insurances, and retirement benefits to mention a few. Note that any payment that should be made during the contract period should also be included in this section.
Since the employee will be part of the company’s staff, he or she may get access to some confidential materials or information. In order to prevent unauthorized sharing with outsiders, some employers may want you to sign a separate non-disclosure agreement; some include it in the employment contract agreement.
So as to make the agreement legally binding, each party (employer and the employee) should sign the document. Once signed, an aggrieved party may take legal action to address his/her grievances.
Employment Contract Agreement Templates
Most of the time, creating an employment contract agreement takes long, thoughtful hours and energy. At the same time, it involves navigating a minefield of probable legal factors relevant to the employment. In order to avoid all the huddles, effort, and confusion, you can go ahead and download our ready-made employment contract agreement templates here. The templates are very comprehensive and will help you get the employment contract agreement easily.
Frequently Asked Questions
Well, an Employment Contract Agreement can either be written or be verbal. In as much as it is recommended to be in written form, verbal agreements are also accepted.
You’ve successfully done the interview, you are waiting for official feedback and haven’t signed the Employment Contract Agreement. In such cases, the chances are that the employer will give the job to someone else. Therefore, to be on the safe side, you need to sign the Employment Contract Agreement provided by the employer.
Employment Contract Agreement is a legal agreement. Therefore, if you unfairly terminate the contract or breach any duty as described in the policies, you can be challenged in a court of law.
After being employed, there will be some changes in the workplace. Therefore, the employer may only change the terms of the agreement through negotiations with the employee.