EMPLOYMENT CONTRACTS IN COMPANY DRAFTING
An employment agreement is a legal contract that establishes a formal employment relationship between an employer and an employee. Having an employment agreement allows both an employer and employee to establish an understanding regarding the most important terms of employment such as job duties, length, compensation, termination, and general expectations.
Here’s what every employment contract should include:
- Job information
Some key pieces of information to start with include the job title and the team or department with which the employee will work.
- Compensation and benefits
It should include the annual salary or hourly rate, information about raises, bonuses, or incentives and how these may be obtained.
- Time off, sick days, and vacation policy
Thoroughly explain the time off policy. How many paid vacation days are accrued per pay period? Do vacation days increase with long tenure? Also explain your expectations regarding sick days, family emergencies, or unpaid leaves.
- Employee classification
Define whether the new hire is an employee or contractor to ensure tax and insurance compliance.
- The schedule and employment period
The contract should clearly state if employment is ongoing or for a set term. It should also include when the employee is expected to work to define the employer-employee relationship.
- Confidentiality agreement
Protect sensitive information like business trade secrets and client data by having the employee sign a confidentiality agreement within the contract.
Clarify what’s OK and what’s not regarding the use of social media and email on company property.
- Termination terms and conditions
Explain what is required for either party to terminate the relationship, including the amount of notice required and if it should be written.
- Severance or outplacement plan information
It’s a bit early to be thinking about this, but should you or the employee decide to part ways, you’ll want to do so nicely to maintain a positive employer brand.
- Requirements after termination
The contract should include any restrictions or mandates on an employee after leaving the organization. For example, an employee may not be allowed to start his or her own business in the same industry within the same locale in a specified time period or work with the business’s clients independently.
Easydrafting will help in drafting a suitable employment contract.
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