Components Of an Employment Contract

Components Of an Employment Contract

An employment contract refers to a document signed by the employer and the employee defining the terms of their relationship. Ultimately, this type of document contains both advantages and disadvantages. Therefore, as an employer, there are several factors you need to put into consideration before getting into a contract with an employee.

Employment contract entails the following:

A good employment contract should clearly define what an employer can expect from his employee when it comes to performing his or her duties. The agreement should also spell out what an employee should expect from his employer. Besides the tasks to be performed by the employee, an employer can include the following terms in the employment contract:

The terms defining how a worker should carry his or her duties.

What happens when an employee is unable to carry out his/her duties due to sickness?

The benefits an employee can enjoy when he gets disabled in his line of duty and not forgetting life and health insurance.

Assignment clauses which define the rights an employee is entitled to enjoy

Non-disclosure agreements connected to the worker’s trade secrets.

What are the advantages of using employee contracts?

Provides an employer with an opportunity to retain his or her best employees

An employee can include additional terms to the contract that bars the employees from terminating their contract with his or her company. This leaves them with no choice other than to continue working for the firm. This is usually the case to companies that subject their employees to training for a specified period before they can get into work. Such employers are entitled to add clauses in their employment contract that spells out the number of years an employee should work with the company before being allowed to leave for a different firm due to the reasons known to him. Releasing such an employee immediately after training will be a loss to the company considering the resources invested in training.

Addition of Confidentiality Clauses

The employment contract bars employees from disclosing the company’s trade secrets to third parties because as they work for the company, they are likely to discover such secrets. As an employee, you should add this clause to your employment contract to ensure your company secrets remain confidential.

It helps the employer to hire the best employees.

It is common for employers to hire the best employees and offer them different and improved employment contracts. If an employer is satisfied with the employee working abilities, he can offer him/her fresh terms, and this will ensure the employee will work for his firm for a long time while delivering high quality services.

Disadvantages of using employment contracts

Limitation in employee’s flexibility

Employment contract restrains the employee’s agreement because the employees are required to abide by the terms and conditions of the contract as defined by the employer.

As from the above employment contracts are very beneficial to the employer as it offers him or her the opportunity to hire the best employees and retain them for an extended period. Also, employees are made aware of their roles and what they should expect from their employers.