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What should go into an employment contract?

Think of your written employment agreement as the document that provides certainty in your working relationship. Your goal is to maximize your rights as an employer, reduce labour costs, and create the foundation for a positive working relationship. A contract should lay out very clearly what you expect from the employee, and what they will be earning for their work. Granted there may be slight changes to a role over time, such as slight modifications in duties, or changes in hours. Language can be written into the contract to offer you some flexibility without having to change the entire agreement. 

Typically, an employment contract is going to outline some of the basic details of both the employer’s and the employee’s responsibilities. This includes job duties, hours of work, compensation (including any bonuses and benefits), and any restrictive covenants such as non-competition or non-solicitation clauses. The employment contract itself does not have to be the only written document that governs the working relationship. Many employers also have employee handbooks with workplace policies that they expect employees to follow, and this can be included as an extension of the contract as well. 

The most important piece of the contract for employers though is that termination clause. It’s where you (with the help of your lawyers) can skillfully limit what you owe an employee if you need to let them go. It is the one major piece of an employment relationship that does NOT default to the employment standards legislated minimums if not written down, so it must be handled carefully. 

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Markham, ON
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Phone: 416-864-8500
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