If you decide to use employment contracts for your employees, they can actually help protect your business in some cases by defining that relationship. For instance, the contract can lay out exactly how many vacation days the employee gets and what the ramifications are for taking too many days. If you then take action based on those stipulations, there is no room for the employee to argue that it was unfair or discriminatory. Those are the terms that they agreed to up front.
So, what should you think about putting in that employment contract? Here are six key points you may want to address:
- How long the business relationship is going to last, if it is not indefinite. For instance, they may only be employed until a project is completed.
- What responsibilities the employee has and what they are expected to do on a daily, weekly or monthly basis.
- What time off they get, such as sick days and vacation days, and how those can be used.
- Why the employee can be fired.
- If the employee has to agree to keep any trade secrets and what can happen if the employee breaks that agreement.
- If the employee is allowed to work for a similar company after they decide to quit or if they get fired. If they can work elsewhere, the contract may limit what information they can take with them.
This is not a full list of everything the contract needs, but it can get you started. Make sure you know what steps to take, how it protects your company and how to use the contract in a dispute.