Every new employee hired represents a new business relationship with a potentially valuable resource, and so a well-structured employment contract ensures that all parties involved are put in a position to benefit right away.
The employment agreement outlines the considerations of employment on both ends, and creating a comprehensive contract that provides for any foreseeable scenario can be challenging. Nevertheless, an employment agreement is the final, impartial word in any workplace issues, and having one in place now can save tremendous hassle later.
Employment contracts are intended to govern the full length of employment, including the ending stages, and so they must also define the conditions the end of the contract. Any provisions such as a required contract renewal/termination notice, unused leave or procedures for outstanding pay due/expenses owed at the end of the contract should be covered in detail.
Non-compete, non-solicitation and intellectual property clauses are tools companies commonly use to protect proprietary resources developed within the company. A sound employment contract also explicitly addresses offsite issues that commonly arise, including types of leave, required leave and flexible work arrangements.
While a company’s Human Resources department is most commonly tasked with developing employment contracts, the reality is that doing so requires a wealth of legal knowledge to stay abreast of the most current guidelines. Many HR personnel not only lack the expertise to structure an employment contract to offer the most sustainable set of conditions to each employee hired, but may not even be dedicated HR employees, instead handling an array of additional supervisory or clerical roles.
Contracts devised by insufficiently experienced employees may work in the majority of cases, but can often be subject to vague wording, loopholes or other enforceability issues. These contracts are often useless in practice, as a disgruntled employee can easily challenge them in court, exposing the company to legal costs and expenses. To ensure that an employment contract is valid, well-structured and promotes a healthy, productive work environment, it may be wise to have it created or evaluated by an employment lawyer.