An employment contract is a legal document establishing an employment relationship between an employer and their employee. Employment contracts can be verbal, in writing, or implied. While written employment contracts are essential for higher-up employees who serve in managerial roles or perform duties integral to the employer’s business, part -time and hourly employees generally have written contracts as well. An employment agreement is not the same as an independent contractor agreement. Employment agreements create an employment relationship. An independent contractor agreement is used for situations when someone does work for a company but does not become an employee, such as freelancers working under contract.
This Employment Contract (the "Contract" or "Employment Contract") states the terms and conditions that govern the contractual agreement between [Sender.Company] (the "Company") having its principal place of business at, [Sender.StreetAddress] , [Sender.City] , [Sender.State] , [Sender.PostalCode] and [Employee.FirstName] [Employee.LastName] (the "Employee") who agrees to be bound by this Contract.
Written employment contracts are used for new hires. You may also get a new or updated employment agreement if you are promoted or your employer undergoes a restructuring.
WHEREAS, the Company is engaged in the description of business; and WHEREAS, the Company desires to employ and retain the Services of the Employee according to the terms and conditions herein.
NOW, THEREFORE, In consideration of the mutual covenants and promises made by the parties hereto, the Company and the Employee (individually, each a "Party" and collectively, the "Parties") agree as follows:
The term of this Employment Contract shall commence on (Start.Date) (the "Start Date"). The Employee agrees and acknowledges that, just as they have the right to terminate their employment with the Company at any time for any reason, the Company has the same right, and may terminate their employment with the Company at any time for any reason. Either Party may terminate said employment with written notice to the other Party.
This employment agreement creates an at-will employment relationship between the employer and employee, meaning that the employer can terminate the employment for any legal reason, the employee can end the relationship (quit) at any time, and the employee is not guaranteed employment for any particular period of time or a fixed term.
The Company shall employ the Employee as [Employee.Title] (the "Position"). The Employee accepts employment with the Company on the terms and conditions outlined in this Employment Contract and agrees to devote their full time and attention (with reasonable periods of illness excepted) to the performance of their duties under this Contract.
The Employee pledges to operate in line with this Contract and in the business' best interests, which may or may not require utilizing their full range of abilities to carry out all job-related responsibilities. The Parties agreed to follow all guidelines, practices, norms, and requirements that are enforced by the Company in the performance of the functions and obligations of the job. Additionally, when working for the Company, the Employee promises to follow all applicable community, municipal, statewide, and national statutes.
In general, the Employee shall perform all the duties outlined in the job description in Exhibit A attached hereto.
Instead of attaching an exhibit with the job description, you can place all duties as a bulleted list in plain language. If you want a catch-all at the end, you can also list “Any additional duty reasonably requested by the Company.”
In consideration for the performance of the duties hereunder, the Employee shall be entitled to compensation as follows:
The Company shall pay the Employee an annual salary (the "Annual Salary"), also referred to as “Wages.” Initially, the Annual Salary shall be at the rate of (Annual.Salary.In.Words) ($Annual_Salary_Amount) per year. The Annual Salary shall be payable in installments, minus the usual and customary payroll deductions for FICA, federal and state withholding, etc., at the times and in the manner in effect in accordance with the usual and customary payroll policies in effect at Company.
The Company shall pay and provide to employee retirement plans, health insurance, disability insurance plan benefits, and other benefits generally in effect for salaried employees of the Company beginning on the Effective Hiring Date in accordance with and on the same terms as are generally in effect for employees of the Company.
The Employee shall be allowed paid time off for vacation, holidays, and other employee benefits not described above in accordance with the Company policies in general effect for the Company's salaried employees.
If the Employee will be paid hourly instead of a salary, you will need to change section accordingly. You could also include hours of work in this section, or you could refer to an employee handbook for more information about work hours and benefits.
The Employee shall not (i) disclose to any third party any details regarding the business of the Company, including, without limitation, the names of any of its customers, the prices it obtains, the prices at which it sells products, its manner of operation, its plans, its strategies, any of the Company's trade secrets or any other information pertaining to the business of the Company (the "Confidential Information"), (ii) make copies of any Confidential Information or any content based on the concepts contained within the Confidential Information for personal use or for distribution unless requested to do so by the Company, or (iii) use Confidential Information other than solely for the benefit of the Company.
Employee acknowledges and agrees that any legal remedy for any breach of this confidentiality provision may be inadequate and, in the event of any such breach, the Company shall be entitled to immediate and permanent injunctive relief to preclude and/or any such further breach (in addition to any remedies at law to which the Company may be entitled) without the posting of any bond or security therefore.
Confidentiality provisions or confidentiality agreements are sometimes known as nondisclosure agreements or NDAs.
Within seven (7) days of the termination of this Contract, whether by expiration or otherwise, the Employee agrees to return to the Company, all products, samples, or models, and all documents, retaining no copies or notes, relating to the Company's business including, but not limited to:
Include a basic list of items obtained by the Employee during its representation of the Company. For example, this list can include items such as a laptop, client list, or samples. Ensure that any confidential information the Employee may have is included.
A Non-Compete Agreement is essentially a contract that states an employee that is currently working for a company promises not to work for that company’s competitors under any scenario for a predetermined amount of time after leaving their position. A Non-Solicitation Agreement is a contract in which an employee promises not to approach any of the company’s customers, staff members, or coworkers for financial benefit or business trading.
Employee hereby agrees (the "Non-Competition Agreement") that, upon the termination of Employee's Employment (for whatever reason, whether during the term of this Agreement or after the termination of this Agreement), for a period of (number of years) following the termination of Employment, Employee shall not directly or indirectly (whether as an officer, director, employee, partner, stockholder, creditor or agent, or representative of other persons or entities) engage in the (Company's industry or type of business) business or in any business in which the Company has, as of the date of such termination, engaged (the "Company's business"), in (Country, State), any county contiguous to such county, and in any county or state in which the Company maintains an office (the "Trade Area").
Employee also agrees (the "Non-Solicitation Agreement"), that for a period of (number of years) following the termination of Employee's Employment (for whatever reason, whether during the term of this Agreement or after the termination of this Agreement), Employee shall not directly or indirectly (whether as an officer, director, employee, partner, stockholder, creditor or agent, or representative of other persons or entities) contact or solicit, in any manner indirectly or directly, individuals or entities who were at any time during the original or any extended Term clients of the Company for the purpose of providing (type of services Employee) services by Company during the Term or contact or solicit employees of the Company to seek employment with any person or entity except the Company.
Employee agrees that (i) any remedy at law for any breach of the Non-Competition Agreement and/or the Non-Solicitation Agreement would be inadequate, (ii) any breach of the Non Competition Agreement and/or the Non-Solicitation Agreement shall constitute incontrovertible evidence of irreparable injury to the Company, and (iii) the Company shall be entitled to both immediate and permanent injunctive relief without the necessity of establishing or posting any bond therefore to preclude any such breach (in addition to any remedies of law which the Company may be entitled).
Non-compete and non-solicitation agreements are not appropriate for all employees, so delete it and renumber the remaining paragraphs if you don’t need this. If you do decide you need this, keep the time period and geographic area limited to what is absolutely necessary to protect your legitimate business interests.