Small and mid-sized businesses in Alberta regularly hire employees. However, quite a few of them fail to realize the significance of a well-drafted and legally enforceable employment contract that is available in written form.
What is an employment contract?
An employment contract defines the employee-employer relationship and describes the role, responsibilities, and payment and benefits of each party.
If you are an employer, it protects your interests, in case there is a dispute, or a particular employee needs to be terminated.
Why is an employment contract significant?
An employment contract assumes significance since terminating an employee is a time-consuming and an expensive process for an employer, especially the owner of a small and medium business who has not made a provision for it.
In the absence of a written employment contract, or where it is poorly written or executed, there are often grounds for a dispute and this dispute typically escalates and lands up in a court.
Courts usually make use of the common law system to settle disputes and it has been seen that judges mostly rely on prior case law. This practice is unpredictable and can be risky for employers. Therefore, to avoid such a situation, it is strongly advised to implement an employment contract that clearly mentions the expectations, rights, and responsibilities of the employer and the employee.
Corporate lawyers Calgary specialize in employment law and are able to review your needs and provide you expert guidance on all matter related to employment. They will ensure that your employment contract includes all the necessary provisions that are required to protect your interests both during and after the employment relationship.
What are the key elements of a typical employment contract to make it valid?
Among other items, a typical employment contract must include 3 elements – an offer, an acceptance and a consideration, in order for it to be valid:
- An offer is a presentation of a job to a candidate as an offer letter and without any legal obligations.
- An acceptance happens when the candidate accepts this offer of the job by signing and returning the offer letter.
- A consideration is the promise of employment. It implies that the employment contract should be properly executed prior to the employee starting the job.
In order for an employment contract to be binding, it is imperative that employment contracts are signed in advance by both parties since employees cannot sign employment contracts on their start date, or anytime thereafter.
In case an employee has already started working without signing the written employment agreement, then fresh consideration must be provided. This can include anything from a signing bonus, to a raise.
What other essential elements need to be included in employment contracts?
Corporate lawyers Calgary provide you hands-on guidance and help in preparing employment contracts, so that all essential elements that define the employer-employee relationship are included in it, and nothing is missed out. The other essential elements include:
- An offer of employment
- Employee roles, rights, and responsibilities
- A non-compete clause
- Non-solicitation agreement
- Confidentiality statements
- Termination provisions
- Employer severance pay obligations
On what element of an employment contract do we need to focus more?
Corporate lawyers Calgary recommend that you must clearly outline the employee’s roles, rights, and responsibilities. This will ensure that disputes don’t arise later on. Secondly, attention must also be paid to termination, non-solicitation, and non-compete provisions and they must be carefully drafted and properly worded, so that they can be relied upon in the event of a dispute.
If you are a small and medium sized business owner who hires employees for your ongoing work on a regular basis, it is highly recommended that you make use of the services offered by corporate lawyers Calgary.
They are professional, friendly and experienced lawyers who can guide you on all matters related to employment, especially when you need guidance and advice related to employment contracts, letters, and agreements.
You must never attempt to do your own research on the internet, pull an existing employment contract from the internet, make modifications in it and start using it.