PAY ATTENTION! 5 Essential Employment Contract Terms

Employment contracts are the foundation of productive and mutually beneficial relationships between employers and their employees. Employees should make sure the employment contract is clear and fair to their interests before signing it. Whether your work comes in the form of collaborations, sponsorships, or traditional partnerships, here are five employment contract terms you should always keep your eye out for:

  1. Compensation and Benefits. This provision is usually one of the first things employees look for in their contracts. Compensation should define all of the compensation the employee will receive during their employment, including any benefits the employer will provide. These can be things like commission rates, sign-on bonuses, and production bonuses. The language should express how and when compensation is paid and provide benefit explanations.
  2. Scope of Employment. Scope of employment provisions are the place for employers to outline exactly what the employee’s job entails. This includes a clear description of the position, the employee’s obligations to the employer, as well as duties employees are not obligated to fulfill, and a clear explanation that the employee cannot have conflicting obligations. Clarifying employees’ responsibilities up front leaves less room for misunderstanding key roles and responsibilities. This provision should also establish what will happen if the employee acts outside of their scope.
  3. Termination. A termination provision governs when and how the employment contract ends. It could allow the employment to end at any time for any reason or no reason, renew each year at the parties’ discretion, or continue for a certain number of years. This provision should also stipulate whether parties must give written notice to each other before terminating the relationship.
  4. Non-Competition. Employers use non-competition provisions to restrict a prior employee’s ability to go work for a competitor or get into a competing line of business within a specific radius after completing their employment with said employer. Florida law allows non-competition provisions, so employees should look out for this language hiding in their employment contracts.
  5. Intellectual Property. A provision that is often overlooked is intellectual property. You may see this referred to as “works made for hire.” Employers will usually want works created by employees during their employment to be property of the employer, that way they can continue to use the ideas even after the employee is gone. These works can be inventions, research, techniques, or products the employee has created during the time she was employed. Some employers may grant the employee ownership rights while assigning the employer a license to use the works. Since there is not one standard practice concerning these provisions, it is important to have a contract lawyer review yours.

By carefully considering and negotiating these essential provisions, employees can protect their rights, clarify expectations, and foster long-term success in their respective industries. Keep in mind that important provisions may vary depending on your field. Contact Venustas law to review your employment contract and help you safeguard your interests.

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