Employment contract or contract of employment is a document that is necessary to be used when there is already an employment process or procedure that will take place. This document is of benefit both to the employer and the employee as it can ensure that the transaction is legally binding and has been agreed upon by both parties. There are a lot of ways by which an employment contract can serve benefits to the transaction and those are what will be present in the discussion present below.
An employment contract is basically an agreement between two parties, which is the employer and the employee. This is done before a particular individual is hired by the organization or business. When running a company or business, it is important to have an employment contract that will outline and include all the necessary information and details regarding the terms and conditions, rights of both the employer and the employee, benefits, and so on.
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In case of any misunderstanding between the two parties, the written contract will allow them to resolve any issues that they may have since the employment contract clearly contains the terms that were agreed upon by the employer and the employee before the document was signed.
In this article, we have gathered all the necessary information needed to help you learn the benefits of an employment contract, the necessary elements needed to be present in the contract, and the nature of employment contracts. Plus, we have some tips that you can use as a reference to help you before you sign your employment contract.
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Nature of Employment Contracts
Employment contracts are curated by employers to make sure that they will present an employment agreement to their employees. Employment contracts are given after the job offer form has already been approved by a qualified applicant who will soon be an employee of the business.
The usage of employment contracts can be defined as follows:
- It assures that the information presented to an applicant during the job offer will be carried out in the contract. This will let transparency with regards to the expectations of the employee and how these expectations can be supplied by the offer of the company.
- Employment contracts are documents that contain all the information that a qualified candidate should be aware of before entering into the employment transaction and agreeing to the offer that will be given to him/her in exchange for his/her services.
- Employment contracts are legal documents that should be honored and followed for the benefit of all the parties involved. Since employment contracts are signed both by the employer and the employee, it should be a fact that the content of the document should be carried out within the entirety of the employment duration.
Employment contracts play a vital role in assuring that the rights of the employer and the employee are protected and not violated. Make sure that you are already aware of the information about this document so you can fully maximize its usages.
Inclusions of an Employment Contract
An employment contract should have the following characteristics:
- It should be precise and accurate. The information present in the employment contract should be kept to the minimum to make sure that no misunderstandings and over expectation will occur.
- Employment contracts should use a language that is simple and understandable. Employers should make sure that employment contracts are written in a manner that it is easy to understand and interpret. This will allow employees to have an easier and faster time to identify items that they would like to ask about, change, or request to be removed.
- It should be organized and properly put together. Employment contracts should have a format to follow so that the smooth flow of information within the document will be achieved. It is of importance for employment contracts to be organized as its details shall be grouped according to how they are usable in the employment.
The information that should be included in the employment contract are as follows:
- The information about the job. This includes the following details:
- The title of the job position that will be given to the qualified candidate upon employment
- The description of the job functions that the employee is expected to provide the company with
- The department or division where the employee will be assigned
- The evaluation of the performance of the employee may it be for regularization or promotion
- The outline of the compensation that will be given to the employee in exchange for his/her services
- The additional benefits, allowances, and bonuses that an employee is entitled to have with varying conditions and terms
- The details of work schedule and work day leaves, which include:
- The number of days that the employee is expected to report to the workplace
- The days off that the employee is entitled to have
- The number of hours per day that the employee should work within the vicinity of the business location
- The policies of the business with regards vacation and sick leaves
- The duty hours of the employee
- The shift changes that the employee will immerse in if there are any
- The classification of the employment
- The employment period terms and regulations
- Agreement on confidentiality with regards the information presented to the employee about the business, the offer, and the work post that he/she will get
- Conditions for termination and other rules that the employee should be aware of
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Tips Before You Sign Your Employment Contract
Before you sign your employment contract, it is important that you completely understand its contents before you sign it. Here are some tips that will be useful to remind you of the necessary things you need to check before you sign one.
- Completely read all the contents of the employment contract such as the terms and conditions, clauses, and other relevant information.
- Before you sign the contract, ensure that you have read and understood the grounds for termination written in the document. It is important for an employment contract to specify and expound the termination clause included in the contract.
- Always check the job title as well as the job description before you sign the document. This is to ensure that you clearly understand what the company or business expects from you when you start working.
- Remember to check the section that specifies your bonuses and salary. The salary written in the employment contract should match the salary that has been previously negotiated.
- Check the working hours indicated in the contract. It is necessary that you know whether you need to work on weekends, weekdays, holidays, and graveyard shifts, etc. This will allow you to negotiate with your employer before you accept and sign the contract.
- Aside from the working hours, it is also important to check your vacation leave and sick leave. Depending on the country that you work in or your employer, the vacation and sick leave can vary. Understanding this part of the contract will allow you to know the number of vacation and sick leaves you are entitled to have within that particular year.
Benefits of Using Employment Contract
If you think that the employment contract is only beneficial in the part of the employee, you better think again as this document is also of importance to the company and its processes. Here are some of the benefits that using an employment contract can provide:
- Employment contracts can assure that there is already an understanding about the employment, which should be honored by all the parties. This way, disputes can be easily addressed in the future.
- An employment contract can showcase the obligations of parties to one another. This will help them identify whether there are obligations that are not properly implemented or given.
- Employment contracts help the business in providing all the things that it can give to an employee. It then helps employees to set their expectations accordingly.
- A well-written employment contract can give clarity to the gray areas that an employee would like to be knowledgeable of, especially in terms of salary, the nature of the business, and the processes involved in the employment that is offered to him/her.
An employment contract may be a simple document but it sure does have a lot of advantages. It is essential for an employment contract to be curated and presented as it can make the transaction more formal and applicable to be used in the business industry. Whether you are an employer or an employee, having an employment contract on hand can make you more secured that your rights are protected and are well documented and recorded.
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