Top 5 Things to Consider While Creating an Employment Contract Template
When it comes to creating an employment contract template, comprehensive contract drafting can help protect both the employer and the employee2 min read
When it comes to creating an employment contract template, comprehensive contract drafting can help protect both the employer and the employee. Early precautions can ensure that both parties have their rights and duties clearly detailed before any conflicts arise. Furthermore, taking into account the specifics of the jurisdiction and the interests of both parties can help ensure that business operations remain compliant with regulations. For employers in New York, here are the five key things to consider before moving forward with an employment contract template.
1. Comply With the Law
An employment contract must comply with pertinent state and federal regulations. The contract should outline an employee's rights, compensations, and obligations, while also adhering to the restrictions set in place by the Department of Labor and other governmental authorities in the state of New York. In order to ensure compliance, employers should seek counsel to understand the necessary legal requirements for the state and stay up-to-date on any changes in regulations.
2. Define the Terms of Employment
The letter of employment must define the terms and conditions related to the position. This includes expectations regarding the employee's performance, the duration of the agreement and the employee's salary. Furthermore, agreements should indicate when a position can be terminated, along with its severance package if applicable. Lastly, the employee's job responsibilities should be outlined in detail as to prevent any confusion.
3. Acknowledging the Ability to Terminate
In the case of a termination, it is important for employers to identify a procedure for how the situation is to be handled. It is also beneficial to make note of the limitations that will prevent the employee from bringing a breach of contract case against the employer, as long as the employment agreement is properly drafted and maintained. Employees can also be made to sign any proper post-termination documentation required by the Federal Trade Commission (FTC) or Department of Labor (DOL).
4. Make Use of Non-Compete Clauses
Non-compete clauses aim to protect the employer from the employee taking advantage of confidential information acquired during employment and applying it to a rival organization or in line with a competitor's business interests. By understanding the expectations and goals of the employees, employers can better determine if the incorporation of a non-compete clause is a viable option when it comes to their employment contract.
5. Include a Dispute Resolution Clause
Last but not least, a dispute resolution clause should be set in place, detailing how the employer and the employee will address potential disputes during the course of the agreement. A dispute resolution may involve a mediated negotiation process, usage of an arbitration panel, or even the option to litigate in a court of law. Employees should also be made aware of their rights to representation in either a mediated discussion or a formal hearing.
To ensure that a contract is mutually beneficial for both the employee and the employer, relying on legal counsel that understands local regulations can help move the process along. With such counsel, employers may better understand the laws surrounding work regulations and receive support with creating employment contracts that meet the needs of their organization.
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