Employment contracts – what they are and what they should contain?

The term “employment contract” has different interpretations depending on the situation like job contracts, employment agreements, and others. The title does not really matter as much as what conditions and information the agreement contains. Moreover, although it usually does not mean that an employment agreement doesn’t exist, it is recommended that agreements be written instead of communicated verbally.

An employment contract describes the duties, responsibilities, conditions of work, and rights of the employee suitable for both sides and considering the labor law and the company policy. For employment agreements override completely or in part the at-will rules applicable by default in most states.

An employer’s verbal commitments with an employee may result in an enforceable employment agreement

In the hiring process or during the employment relationship, employers, including their managers and supervisors, may make verbal commitments to one or more employees that impact their terms and conditions of employment. Based on U.S labor law, that employer and employee(s) may not fully consider the impact of the verbal agreement which may in fact be an enforceable employment contract that overrides their at-will relationship. Employers that wish to avoid entering into unintended employment agreements should educate their managers and supervisors about the risks and consult with human resources, employment attorneys, or other experts for help.

Types of employees and employment contracts

There are three common different types of employment relationships in the USA. These are permanent employees (can be full-time or part-time), seasonal or temporary employees (can be full-time or part-time), and independent contractors. Now let’s take a closer look at each of these contract types to learn what conditions they are applicable for and actually contain.

Permanent employees and contracts

This type of contract implies that an employee is hired for a permanent job position that does not have a limited employment period. Permanent employees with employee agreements are frequently full-time workers that receive all employment benefits such as vacation, sick leaves, insurance, and so on.

Seasonal or temporary employees and contracts

This contract does not last long usually. It has a specific start and end date during which an employee is obliged to execute the tasks written in the agreement considering the requirements and deadlines. These short-term assignments also give the employee access to the benefits of the company but are usually limited compared to full-time permanent employees. This type of employment contract is also applicable in case of the absence of another employee in the same position.

Additionally, seasonal or temporary employment contracts can be used with student interns that don’t provide any benefits to the interns and give the intern fewer protections if they become unneeded or perform poorly.

Independent contractors

This is a specialist that offers a particular range of services to other companies (like freelancers) or rents a station within a company. Independent contractors are technically not employees of the business. It means that this employee is independent in his rights and duties but is responsible for the execution of assigned tasks. The taxes are paid by the independent contractors as well as insurance, vacations, etc.

What should the employment agreement contain?

The employment agreement should be an extended document where all vital information should be recorded to be used in cases of misunderstanding between an employee and employer. So what the employment agreement should actually consist of and what points are vital to consider when creating it? Here is the top list of key things:

  • selection of types of an employment contract it is as the further cooperation fully depends on it;
  • the date when your cooperation starts or will start;
  • the location where the employee is going to work – home offices are becoming more preferable today;
  • detailed information about the employer (company) and the employment statust (employee’s personal information, exempt or non-exempt, taxes, and so on;
  • ithe work schedule – days, hours, and other extra conditions when the employee should be in touch;
  • marking the duration of the probation period if needed including what benefits are available for the employee during that period;
  • the hour rates and summary payroll for a particular period of time like week or month, also consider the overtime hours and their cost;
  • a precise number of vacation days, weekends and national celebrations, sick leaves, and other additional rules to take into account besides company policy.
  • conditions under which your cooperation is possible and also impossible to know the duties and responsibilities for both sides.

One more tip is that employees and employers can entrust writing employment contracts to a third party like best writers online who has fundamental and proven knowledge in the labor law and is not interested in cheating on any of the sides. Such companies provide the services of writing different types of documents that can be notarized and get official status. Only such a written agreement can be discussed in court in case your partnership will not correspond to the agreement.

Taking everything into account

The choice between verbal and written employment contracts is up to your employer. A verbal agreement is okay. Nevertheless, the written form is almost always better as it is a kind proof of your agreement and its conditions. This is important because people tend to forget their promises and agreements with time and you won’t be able to prove anything without real documents. So it is wise to spend some more time and money to create the employment contract to get the signature from the parties and be protected by labor law under any circumstances.

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