Employment Contracts

What Should I Know About Employment Contracts?

As an employer, it’s important to ensure you’re familiar with the finer elements of employment contracts to ensure you’re able to draft them effectively. If you don’t have a lot of experience putting together new contracts, it could be a good idea to seek advice from a qualified employment lawyer.

As employers, we understand that drafting new contracts can be confusing, especially if your prospective employee is serious about negotiating the terms and conditions of said contract. With this in mind, we’ve put together the following list of important things you have to know:

Make Sure That All New Contracts are Clear and Concise

One of the most important things when drafting a new employment contract is ensuring that everything is clear and transparent. Make sure that you don’t include ambiguous clauses or conditions which could be interpreted differently by an employee or their lawyer.

It’s particularly important to be aware of this when it comes to things like bonuses, time off, and potential pay rises. Additionally, ensure you clearly outline the basis on which the employee will be paid – will you pay a salary, hourly wage, commission, or via a piece-rate agreement?

Clearly Outline the Employees Tasks

Next, make sure that you clearly list the key tasks and duties that an employee will be responsible for if they sign the contract. Doing this will ensure the person you hire will understand exactly what they’re expected to do.

Meanwhile, clearly outlining the roles associated with a position will provide you grounds for terminating the contract in the case of poor performance. Because of this, it’s usually worth consulting with a lawyer to make sure your contracts are well worded and legally binding.

Specify the Type of Contract

There are five main types of employment contract in Australia. You need to clearly specify the type of contract before signing it to reduce the risk of confusion or miscommunication between you and your new employee. The main types of contract are:

Casual – Casual employment involves irregular hours with no promise of ongoing employment. Casual rates are usually higher, but contracts can be terminated at any time, and casual employees aren’t entitled to annual or sick leave.

Full-time – Full-time contracts are generally for ongoing-employment and usually involve 38 hours of work each week. Full-time employees are entitled to sick and annual leave, along with other benefits.

Part-time – Part-time contracts are near identical to full-time but involve fewer hours per week.

Fixed-term – Fixed-term contracts specify a fixed employment period. These are designed for either seasonal jobs or those with a clear completion point.

Independent contractors – Finally, we have independent contractors, who tend to be self-employed. They often work for multiple companies and can negotiate their own pay rates and working hours.

Final Word

As you can see, there’s nothing too complicated to worry about when drafting new employment contracts. The legal jargon can get a little confusing, so if you’re having trouble, we’d highly recommend speaking with an experienced employment lawyer.