Writing an employment contract
When writing a contract for your new employee there are often a number of things to consider.
The reasons for having a thorough, pertinent and correct employment contract between an organisation and its recruits are numerous. But what should be included in this document and why is it of such significance? Here are somethings you should consider when deciding on how to write an employment contract:
Importance of a Contract
The main function of a written contract of employment is to offer protection to employers and employees, denoting the rights and duties of both parties in regards to new appointments. Without a contract it may prove very difficult to impose terms should any complications arise, whether it be gross misconduct or something unforeseen.
A properly formulated document will let everyone know where they stand and prevent future disputes, while a badly written document, or lack thereof, runs risk of an expensive trip to the employment tribunal.
What to Include?
Ensuring that the content of the contract covers contingency for any eventuality that may arise is very important. All contracts must cover certain basics, but there are many variables that are job specific and will only be needed in some circumstances. There are also some rights that are guaranteed by law and therefore implied in a contract, an example of this being the right to work in a safe environment.
One thing that must be determined when writing is the term of the contract. Terms outline how long the contract will last and the length of notice required to terminate it. While terms can be extended, this allows either party to sever the connection without any impediments after the period has been completed.
Duties and actions
The contract should also include clear regulations of what both employer and employee are allowed, and required to do. This should highlight duties as well as forbidden actions. Omitting this from a contract will make it very difficult to enforce, should previous agreements not be implemented.
Pay and remuneration
Contracts should include pay scale for work completed and rewards that the employee could receive on top of that. This may include medical insurance, bonuses, or severance packages. Exact details of how these are earned (or otherwise) should be written in full.
Employers may wish to have employees sign a restrictive covenant on top of their regular contract. In most industries there is a need to protect sensitive information, and prevent former employees from passing it to competitors. Covenants secure this, and where necessary can prevent former employees from working for rivals for a set period.
While this list is suggestive, we would always recommend you approach a contract specialist to assist you with finer details.
Or head back to our employment advice area.