Is a written contract really necessary?
As someone very clever once said to me…..
It’s not necessary until it is.
Chris
Strictly speaking, a written contract is not required. If you do not give your employees a written contract, the National Employement Standards (NES) will still apply as well as any relevant award. The NES specify 11 minimum employment entitlements that must be provided to all employees.
Issues covered in an employment contract
The question is why you should have a contract even though it is not strictly required. A formal agreement gives both you and your employee clarity and certainty about your rights and obligations.
- Terms of employment
What are terms of the employment – full time, part-time or casual, salary and commission structures, hours of work, location of work, RDOs etc. - Duties and expectations
What are the employee’s duties? What standards are expected? If there is clarity about expectations, it is easier to manage your employees. - Confidentiality and intellectual property
Do you need to protect your intellectual property? What happens if your employee claims the intellectual property of any work they created while in your employment?
Do your employees have access to your confidential information? - Restraint of trade
If your employee resigns with intention of working for a competitor, would that damage your business? Do you need to protect yourself? - Termination
What happens if your employee’s work is not satisfactory, or there is misconduct? What constitutes unacceptable behaviour which will allow you to terminate their employment?
If you have a written contract, you have clarity and if you have clarity, you are more likely to avoid disputes.
Yes, it is another thing you have to do and you already have enough on your plate. However, once you have a proper employment contract drafted, you can use that as template for future employees. If your employees’ employment terms and conditions are the same or very similar, you will not need a lawyer to draft every single employment contract.
Like all things in running a business, it is about managing your risk.
If you would like to find out more about getting employment contracts drafted, please contact us. We would be happy to assist.
