Why have employment contracts?
Many employers have experienced costly disputes and unnecessary stress about pay rates and other employment entitlements simply because they failed to set in place clear written contracts and policies that frame the working relationship between employees and employers.
Overlooking the significance of employment contracts can lead to a variety of problems later on, this is especially so when the employment relationship ends on less than amicable terms which usually doesn’t end too well for employers.
It is obvious that the employment relationship involves a contract between employee and employer, whether it be in writing or verbal. The difficulty arises for employers when a verbal contract is at dispute, there is no specific written document that can clearly identify what was or was not agreed to in the first place. That’s why Bisbal HR Solutions recommends a written contract rather than verbal.
What should be included?
Whilst the employment relationship is normally governed by legislation and any applicable Awards or Enterprise Agreements, there are a wide variety of items that should be covered and documented in a contract, they include:
- Hours of work
- Remuneration (including any set off for over award payments)
- Intellectual property
- Restraints (post-employment)
- Leave entitlements (taking of leave and notice requirements)
- Termination notice
- Performance reviews and unsatisfactory work performance
- Dispute resolution
- Company policies
- Governing laws
It is a risky commercial position to put off having employment contracts. A small investment in getting a professional employment contract drafted can help mitigate a domino effect of claims that may arise in your business.
Position descriptions can also help clarify the expected tasks and performance requirements of a role and go hand in hand with employment contracts which should be reviewed regularly to ensure that the expectations of both the employee and employer are clear from the outset. Contracts should also be reviewed when major changes in legislation occur.
If your business requires assistance in drafting employment contracts or enterprise agreements please contact us on 1300 116 400 or send us an email at [email protected]