Samples of Employment Contracts: Everything You Need to Know
Samples of employment contracts can be found online, and you can create a custom template yourself.4 min read
Samples of employment contracts can be found online, and you can create a custom template yourself. An employment agreement documents the rights and duties between a business and an employee who is a W-2 or 1099 worker. An employment contract is also known as the following:
- Employment agreement
- Contract of employment
- Employee contract
- Job contract
Employers use employment contracts to determine the obligations and rights and roles of employees during a work period. A contract also includes information about compensation in the form of wages and payments, vacation times, job descriptions, probationary periods, termination guidelines, and other information pertaining to an employer-employee relationship.
The following individuals should use employment contracts:
- Employers in the form of managers, human resource workers, and recruiting officers
- Employees such as new hires and recruits whose employers do not have any type employment contract
Further, such contracts are used in the following instances:
- High-level management employees
- Short-term contract employees
Employment contracts are enforceable by law if both parties sign the agreement.
Employment agreements list whether the position is full-time, part-time, or temporary. If you are drafting an employment agreement, be aware of the following positions:
- Permanent Full Time: An employee who will be working full-time shifts and has no end date to his or her employment.
- Permanent Part Time: An employee who will not work full-time shifts, but has no end date to his or her employment status.
- Fixed or Short-Term: An employee who has a prearranged date when his or her employment state ends. No notice is required when the end date nears.
It is also common for employers to mandate that new workers finish a probationary period of three months or greater. Employers use a probationary period to ensure that an employee is a right fit for the company and has the skills to perform tasks outlined in the agreement. Further, probationary period helps employers assess whether a worker would be a good fit for the company in the long-term. An employer is free to terminate the relationship at any point during the probationary period without notice, and with no need to offer severance pay.
After the period ends, the company may decide to keep the new person, or the new worker may qualify for benefits in the form of health insurance. After the new hire passes the probation period, the company must provide just cause in firing an employee or give sufficient notice of termination.
Employers may also add the following clauses when drafting an agreement:
Such clauses protect an employer’s interests in different areas where a company could lose business or important secrets.
A non-competitive clause prevents employees from working with a direct competitors during and after a contract term has ended. A non-competitive clause lasts for a certain time after an employee has been terminated, or if the contract expires. With that, the non-competitive clause must come with certain limitations, such as not competing within a certain geographic limit.
A non-solicitation clause prevents employees from encouraging other workers or clients to shift to another service or company. Such clauses must also have certain limitations and last for a set period (ex. 2 or 3 years from the end of the relationship)
A confidentiality clause keeps work-related matters within a company. It also prevents former and current employees from using or discussing business matters, such as:
- Business secrets
- Marketing plans
- Product information
Such information cannot be leaked to other businesses or individuals without permission of the business. Keep in mind that such clauses and the contract itself must be reasonable and legally sound in order to be enforced by a court.
The contract must clearly describe the company and any details of the job that you’re looking to fill. Additionally, the contract should mention employment terms and compensation. Moreover, mention the type of employment an employee would fall under. For instance, state whether the employee is a W-2 or 1099 employee. Under W-2, you would withhold taxes, and 1099 employee would have to pay their own taxes.
At Will Employment
At will employment means that an employer may terminate an employee for any reason, so long as the employer does not discriminate against that employee. Further, an employee may leave for any reason without notice. At-will employment gives protections and freedoms to both parties, and it should be mentioned in any employment contract to prevent confusion in the future.
If you need to find samples of employment contracts, submit your legal inquiry to our UpCounsel marketplace. UpCounsel has some of the most experienced and reputable lawyers in the nation and will help you in all areas pertaining to labor and employment laws. Moreover, they will assist you in drafting an employment contract, and will also be there to help employees who may have been wronged by an employer.