Understanding the importance of an Employment Contract

By: johnson23 | Posted: 12th July 2010

While there are specific terms and conditions between the employer and the employee, it is not always in the form of a written document. The existent clauses may not include specifications about benefits like holidays, leaves, and so on. In such cases, you may opt for an employment contract.

Before you sign the document, it is a good idea to get it reviewed by a competent employment lawyer. Only he/she can understand the legality associated with the particulars and help you to get a clear idea about it. It is also his/her job to advice you about whether to accept all the terms and conditions or not.

Specifications of the agreement

The specific areas that the contract covers include, but are not limited to, the following -

Term of service: The contract needs to set in writing the particular period for which you would be employed.

Termination: Be sure to put in all details of the circumstances that lead to termination of the job. In case you are terminated from the job before the completion of the term of service, and that too for no fault of your own, the contract needs to mention the benefits that you are entitled to.

Expense allowance: For job related expenses, it is better to opt for a tax exempted expense allowance. Otherwise, it may be difficult to be reimbursed after you have paid for it.

Ownership: If there is any question of giving you ownership interests of any kind, it is essential to know all about its details well in advance and put these up in the contract. Ask your employment lawyer how to do this with the right legal approach.

Relocation: Get all details related to relocation and how you are going to be reimbursed for it on the contract. Also, ensure that the period for which this is effective is mentioned in the agreement.

Bonus: If there is a signing bonus, get the specifications of it in writing. These include how you become eligible for it, whether you need to be at the job for a particular period to be eligible or not, and so on.

Non-compete: If you shift from your job and join another, as per the clause you are unable to compete with your previous employer for a specific period.

Advantages of putting it in writing

It is a good idea to get it all written down in an agreement format and get a review from an employment lawyer. There is lesser scope for misunderstanding in this regard as all the terms and conditions are mentioned in the contract. Moreover, it also ensures that your job is secure.

How do you ensure that all of it is covered by the contract? Ask a New Jersey employment lawyer to check every detail thoroughly. He/she has the legal expertise to review the document and understand whether it is suitable for you or not.

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Tags: job, circumstances, holidays, particulars, leaves, relocation, clauses, employment contract