How a Written Employment Contract Can Protect Your Business
The importance of having effective and well-drafted employment contracts in place cannot be understated. Don’t leave this to chance!
As surprising as it may sound, in Australia there is no lawful obligation to
have a written employment contract in place. In fact, it is quite common for businesses to employ workers on the basis of a ‘nod and a handshake’.
That’s all good and well – But what happens when your employee leaves or if there is a disagreement between you and your employee?
If you don’t have a written employment contract, you may be very disappointed about the degree to which you can protect your commercial interests or defend your position in the case of a workplace dispute.
Naturally, an employment contract should cover things like salary, reporting lines, place of work etc, but there are other issues facing employers, which can be addressed within a properly drafted employment contract.
Protecting confidential information and business goodwill
Plainly speaking, if you do not include confidentiality provisions in your contracts, you are putting your business at risk.
- Spell out what information is confidential in exact terms
- Explain the obligations that arise when receiving such information
Protecting you from ex-employees poaching your staff and clients
A Restraint Clause in an employment contract is sometimes appropriate to protect your legitimate interest (for example preventing your ex-sales person from contacting your clients, whilst working for your competitor
NOTE: Any restraint clauses must be drafted carefully so as not to be considered unreasonable and therefore void – Do not attempt to draft this on your own.
A carefully worded clause may prevent your employees to ‘walk away’ with ideas / concepts / developments they produced whilst working for your business.
There are many more key issues that need to be considered when drafting an effective employment contract, including:
- Dealing with bonuses – express terms or ‘discretionary’
- Policies – what to include and what NOT to include
- Reimbursement of expenses
- Dispute resolution
- End of employment
- Severance provision
- State of jurisdiction
To find out more or to get help drafting a professional and effective employment contract, contact us here or call Signature Staff on +61 7 4050 3888