Vital Contents and Issues in an Employment Contract

Normally when a person gets hired for a job, he is asked to sign documents that will bind him with his employers and define the terms and conditions of his employment. This document or set of documents is known as an employment contract. Typically, employment contracts are written agreements signed with the concurrence of both employer and employee.

However, not all employment contracts are written and explicit; in some cases, some are implied – meaning the terms of the agreement are expressed through verbal statements or actions taken by both employer and employee and through the company memoranda, employee handbook or policies adopted during one’s employment.

Differences between an Explicit and Implied Contract

An explicit employment contract often shows an employer’s limited power to terminate an employee and the definite length of his employment while an implied contract is expressed through verbal statements, employer’s actions, employee handbook or policies and shows how an employee may be terminated for specific disciplinary reasons.

Although most employees work at will in California, employment contracts - which could either be an explicit or an implied contract – are recognized and enforced.

Basically, an employment contract - whether explicit or implied – may contain the following terms and conditions:

• Provisions on health benefits
• Vacation and sick leave
• Procedure of employee grievance
• What an employee should do after termination of the employment relationship

An employer may also include other employment terms and provisions such as the following:

• Non-compete agreement
• Confidentiality agreement
• Compensation agreement
• Non-contract or agency agreement
• Termination clause

Advantages of a Well-Written Employment Contract

Employment disputes may often arise out of issues related to terms and conditions in employment contracts. Wages and compensation, overtime pay, discrimination, leave and benefits, among others, are only some of the issues that can be addressed by a well-written employment contract. Having a well-written employment contract is valuable to both employer and employee as it would clearly define the roles of both parties in a working relationship.

To an employer, a well-written employment contract can help him protect his business from frivolous lawsuits that may arise out of misunderstood provisions or terms of employment. In drafting an employment contract, the employer must also take into consideration the basic provisions of the various federal and state employment laws, to make sure that they comply with the law or the contract does not conflict with these laws.

In order to do this, an employer must consult with an experienced employment attorney to help him prepare and write an employment contract that will serve the interests of both employers and employees.

On the other hand, if you are an employee who finds some issues in your employment contract, you can also consult with skilled employment attorneys to interpret the provisions of your contract and enlighten you on the matter.