An employee contract template is used to make an agreement that contains the rights, responsibilities, and obligations of employee and employer during a period of employment. This contract is signed by the both employee and employer. Moreover, this contract is used for businesses in several industries. With the help of this contract, employees know about the standards they are expected to meet.
However, the employee contract template should contain the following elements; You may also like Employee Clearance Form Template.
- Duration of the employment
- Job responsibilities
- Daily work schedule
- Non-compete agreement
- Termination details
- Severance (if applicable)
How do you write an employee contract?
Let us discuss some steps that act as a guide for you when you write an employment contract;
At first, give a title to your contract so that the person who reviews it can understand what it is. For instance, you can title the contract as (company name) Employment contract.
The next step is to determine the parties. The agreement must states which parties are involved in the contract. Also, write out your company name and an individual name you are hiring.
Next, list the terms and conditions. However, some terms and conditions such as working hours and severance packages are also set by the federal and state governments. Also, every state has different terms and conditions regarding employment so you must check them. Terms and conditions other than the labor laws such as benefits, sick pay, other terms, etc are up to you to decide.
After that, outline the job responsibilities that inform the new employees what is expected of them. If you want to present the responsibilities in a more comprehensive way then you can the percentages to each responsibility.
Then, clearly include the compensation details. Below are some important things that you must include in this section;
- How will the employee be compensated?
- Overtime calculation
- Which types of holidays are paid and unpaid?
- Annual bonuses
- Payment method
Introduce certain terms such as effective date, type of employment, notice, termination, applicable law, and severability.
In the end, when you have all done with the above steps, ask the attorney or legal professional to view the contract to ensure that it is according to the applicable laws. This will surely protect your company from future litigation. You should also check the Case Study Template.
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Benefits of an employee contract Template
Creating an employee contract provides various benefits to both employee and employer. Some of the key benefits are discussed below; You may also see Project Brief Template.
- Employee contract will prohibit both parties to take legal action after signing the agreement.
- Most importantly, this agreement informs the employees what is expected from them and what can happen when they don’t follow the contract.
- The contract also helps you to limit the employees’ overtime pay and holiday pay.
- A confidential clause in the contract prohibits the employees from disclosing sensitive information.
In conclusion, an employee contract template enables you to outlines the responsibilities and rights of employees in an organized way.