Employment Agreement

OVERVIEW

An Employer agrees to employ Employee, and Employee accepts employment with the Company/Employer, on and subject to the terms and conditions set forth in the Employee Agreement. A type of contract used in labor law to assign rights and responsibilities between parties to an agreement is an employment contract, also known as a contract of employment. An “employee” and an “employer” are the parties to the contract. It emerged from the antiquated master-servant legal system.

It can either be a Fixed Term Contract or an Open-Ended Contract. Fixed-term contracts are used when an employer wishes to hire an employee for a specific amount of time that is agreed upon in advance. Also known as task contracts, a fixed-term contract can also be used for the completion of a specific task. On the other hand, an open-ended employment contract does not have a specified end date. Open-ended employment contracts are also called permanent, indefinite, or continuing contracts as they are typically used for long-term employment situations.

ADVANTAGES

•  Security to Employees: Every time an employee leaves, a lot of time and money has to be spent on training a new employee. Adopting perfect employment agreements with benefits, like signing bonus, and planning on spending money on training, will keep employees in the organization for a maximum period. Fixing a minimum period of employment in the agreement will safeguard the interest of the employer as well.
•  Clarity of Roles: The responsibilities and nature of the job will be mentioned in detail. It helps with better focus, performance, and accountability of the work entrusted. It provides a favorable working environment with employees with a clear set of purpose and structure in the company as the job responsibilities are determined and fixed in the agreement.
• Binding: The legal implications and penalties will make sure, that both the employees and the employer will not cease to work before the period of the agreement or within the time frame specified in the contract. Employment agreement will create a legal bind, which will ensure that either party will breach the terms of the contract. Making a legally binding agreement will create better incentives to make a relationship successful.
•  IP Protection & Secrecy:  Employer can have the right or patent on inventions done by the employees using company resources and time even if the intelligence and knowledge of the employees are used for it. Employment agreement can also protect the proprietary and intellectual information being leaked or stolen by an employee by including confidentiality clauses. It will prohibit the employee from any information about the employer to any third person that may work against the interest of the employer
•  Dispute Resolution: Disputes arising out of terms & condition of employment can be settled by reviewing the agreement instead of approaching the court for intervention.