An employment contract is intended to clearly outline the various aspects of a job to ensure there are minimal misunderstandings about the nature of employment regardless of what situations may arise.
However, in recent years, a range of legislation by the Australian federal government place stringent restrictions on the conditions that can be set forth in an employment agreement, and even a technical inconsistency in the contract can expose an organization to the legal process, making it essential that company leaders are familiar with the importance of a proper employment framework.
The first thing to consider when devising an employment structure is to consider the type of employment contract that best suits the nature of your business. Full or part-time employment contract represent a firm commitment on both ends, granting employees certain rights for the life of the contract, while a contractor or sub-contractor agreement is intended to cover specific projects at hand and offers more flexibility for both parties.
Of course, the heart of an employment contract is the practical details it contains. Considerations such as pay, overtime and benefits should be structured clearly to prevent any later confusion. Many employees are governed by Awards, which represent a standard rate of pay at the position of employment, but companies will often try to attract premium talent by offering the ability to negotiate a salary.
Some employers find it prudent to include non-compete clause in their employment contracts to assure valuable employees cannot move to a competitor for a set length of time after the contract. Similarly, a non-solicitation clause restricts the ability of employees to seek employment or outside business in the employer’s industry.
Many employers also use intellectual property protection clauses to protect their trade secrets. Clauses such as these limit the potential for an employee to actively hurt the company using skills and resources gained during employment.
For many companies, the employee conduct policy represents the core of their company culture, defining the model of what is to be expected of an ideal team member. The employee conduct policy must be clearly outlined in the employment framework, detailing the general rules of employment as well as actions that can result in discipline. Consider the guidelines of your employee conduct policy carefully to achieve a balance of fairness and sensibility.
Building a solid employment framework is a painstaking process, but failure to properly construct an employment agreement or subcontractor agreement when hiring personnel is practically inviting disaster. Laws that govern employment agreements are complex and constantly evolving, and so it may be beneficial to have a business or employment lawyer draft or review any employment agreements to ensure they comply with the parameters of the Fair Work Act while still facilitating uniform expectations for everyone in the company.