An employee contract is a document that legally defines the relationship between the employer and the employee. While it is not a necessity for most job positions, a well written employee contract can help to clarify expectations and protect both parties in the case of termination, wage disputes or resignations. If you are a business owner, you may want to consider writing up an employee contract, just like Cleartrust and other top companies have. First however, you must familiarize yourself with the six most important elements of this type of document. To find out what essential points you should include in your employee document, keep reading below.
Having a compensation plan laid out is imperative to a functioning employee-employer relationship. At the very least, your employee contract should list their starting salary, especially if you have a remote team. Additional information regarding how commission is paid and how they may receive a raise in the future should also be included. Outlining the general payment information will prevent wage disputes, which is an important feature of an employee contract.
If you employee hourly workers on a steady schedule, you should include these hours in their employee contract. This will help to clarify any questions they may have. This will also protect you from a wrongful termination lawsuit should things not work out with the employee. This is particularly true if an employee is ever fired for excessive absences or excessive lateness. Protect your business from wrongful termination lawsuits by including the expected work hours of scheduled hourly employees.
Depending on what the position has to offer, you should always outline and include employee benefits in the document. This is more important for business than even a good logo design. Benefits, including health care, 401K, pension and disability, are all plans that should be presented to the employee prior to their first day on the job. Additionally, you may want to include stipulations such as how long it will take for the employee to begin receiving benefits. Making these details known ahead of time can keep future disputes at bay.
Identifying time off is important for any type of job. Sick days and vacation opportunities should be set ahead of time so that employees can plan accordingly. By adding this section to your employee contract, you can ensure that excessive absences are avoided. This section will also help provide your business solid grounds for dismissal if necessary.
It is a good idea to list employee responsibilities in the employee contract. If you already have a prepared job description, use this as a guideline to develop a proper list of responsibilities. This will help to prevent you from having to watch the security camera all the time to make sure employees are doing their job. When you include this in the employee contract, you are making your expectations clear. This will help your employees to excel.
Grounds for termination should always be clearly stated in an employee contract. This will help prevent disputes later on because you and the employee expressly agreed to these specific terms. This is one of the most important project deliverables for an employee contract. Identifying strict rules in your employee contract will be a great help when dealing with employees.
Protection is the final essential point you should feature in your employee contract. If you are hiring someone for a position that deals in private matters of your business, it is a good idea to set up a non-disclosure agreement or something similar. When an employee has access to private or protected information, it is important that you set up parameters for them. An employee contract can help you ensure that employees keep your trade secrets.
Crafting an employee contract is an important part of owning a business, but is not part of the personal loan document requirements. Although it is not required, having this legal document handy can help save you and your business a lot of trouble in the future. Make an employee contract following these 6 key points to ensure that your business and employees thrive.
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