Your Guide to Employment Contracts +Free Contract Template

An employment contract is a written employment agreement documenting the shared rights and responsibilities between your company and a W-2 employee. It is not only the major point of reference for workers, managers, small business owners, HR experts, and recruitment officers. A new employment contract ushers in a number of boons to persons and organizations. Different from an employment contract, a job offer letter is a more common way that businesses clarify the employment relationship with direct-hire employees. In an offer letter, you specify the hire date, pay rate, and job title and spell out any other pertinent agreed-upon information, such as a hiring bonus or extra paid time off. An employment agreement template works as a fill-in-the-blank document.

• There are many people who work from home, therefore they should be aware of the rules to make sure that qualified workers are productive while doing so.
• Clearly state the grounds for termination, required notice periods, and any severance packages.
• They often have to flit between different positions and help out wherever necessary.
• The employer reserves the right to modify any paid time off policies.
• Ensure they dovetail with the legal rights your employees are entitled to receive.

Additionally, when working for the Company, the Employee promises to follow all applicable community, municipal, statewide, and national statutes. The need for detailed and intricate lawyer-drafted agreements are mostly needed for executive and key hires, due to the nature and importance of those roles. The most important thing for businesses to remember is the employee-employer relationship is one of the most important to a business, particularly small businesses. This means that they are usually not entitled to the same rights as employees. Here’s a breakdown for every step of contact creation, with an employment contract doc included below to get you on the right track.

Employment Contracts: What Small Businesses Need To Know

For Employees who require a parking spot for such use, the parking space must be chosen, managed, and upgraded in accordance with the Company’s business automobile policy. Confidentiality provisions or confidentiality agreements are sometimes known as nondisclosure agreements or NDAs. The Employee pledges to operate in line with this Contract employment contracts for small businesses and in the business’ best interests, which may or may not require utilizing their full range of abilities to carry out all job-related responsibilities. The Parties agreed to follow all guidelines, practices, norms, and requirements that are enforced by the Company in the performance of the functions and obligations of the job.

If the contract outlines very specific job requirements, it may be too restrictive, not allowing the employee to grow in the position. If an employer wants to end or change the employment relationship, it can be very difficult and expensive. An employment agreement can outline what type of employee actions or behaviors are grounds for termination.

Employment Contract: Template, What to Include, and Pros & Cons

Those who agree to a zero-hour contract can still claim some statutory employment rights, such as a minimum level of paid holiday and national minimum wage. The following section covers permanent and other types of employee contracts. Learn more about different contracts and how to determine which one is the most adequate for a specific employee profile.

The Employee agrees that they will faithfully and to the best of their ability to carry out the duties and responsibilities communicated to them by the Employer. The Employee shall comply with all company policies, rules, and procedures at all times. Below you will find an employee contract template with a free download that you can use to create your own contract. When contract terms need to be updated, communicate changes clearly and promptly to all affected employees.

Employee position and responsibilities

If you, as an employer, fail to provide the proper amount of compensation for the work or time put in, your employee could pursue legal action. Outlining all details regarding expectations, remuneration, confidentiality clauses and post-employment behavior (such as a non-compete), and termination period in this contract will help mitigate any risks. Don’t make the mistake of assuming you’ll have to hire a human resources team or legal consultant in order to put together worthwhile employment contracts, either. Ultimately, they’re relatively straightforward documents that a small business management platform like Homebase is perfectly equipped to help you with. Best of all, our platform will alert you about changing labor laws and take other team management admin tasks like scheduling, payroll, and team communication off your plate, too.

For employees who will work regular hours (part-time or full-time), are paid a salary or hourly rate, and are ongoing until terminated by either the employer or the employee. Create a contract between a company and a contractor with an independent contractor agreement. These types of agreements, separately or incorporated into the employment agreement, limit what proprietary information the employee may share, if any. To understand this type of contract, let’s learn more about the mutuality of obligation. It means the employer is not obligated to specify and offer minimum working hours, and employees to accept them.