Employment Contracts

5 Tips for Drafting New Employment Contracts

Employment contracts can be confusing, especially if you’re a new business owner who hasn’t employed many people before. Because of this, it’s important to spend some time getting familiar with the legalities surrounding contracts and how they should be drafted.

Many employers use an employment lawyer to ensure they’re complying with their legal obligations, which is never a bad idea. We’ve also put together the following list of our top tips for drafting new employment contracts to help you get started.

Without further ado, let’s jump straight into it!

  1. Specify What the Role Entails

For starters, it’s always a good idea to specify exactly what a job entails when you’re putting together a new employment contract. Make sure you think carefully about the key roles and responsibilities of the position and how you expect your new employee to approach them. On top of this, speak directly with said employee to ensure they’re aware of their exact role.

  1. Explain Sick and Vacation Leave

Clearly outline everything your new employee needs to know about sick and annual leave. Include information about how many paid sick days are available and what happens if you use them all up. Is unpaid sick leave an option?

Similarly, outline everything necessary about annual leave. Consider how much notice needs to be given, what happens to unused leave at the end of the year, and whether or not an employee can be forced to take leave.

  1. State the Type of Employment and Pay Information

The most common types of employment in Australia are casual, part-time, full-time, and fixed-term. Clearly specify which the contract is referring to.

At the same time, make sure you include clear, unambiguous information about pay rates and bonuses. Consider the base salary or hourly rate, overtime bonuses, and/or performance rewards.

  1. Include Info About Contract Termination

Of course, you don’t want to be thinking too hard about contract termination at this point, but it’s certainly a good idea to include relevant information. Some of the things you should think about here include:

  • How much notice should be given by both parties.
  • What, if any, bonuses will be paid if a contract is terminated.
  • Whether there are any special ground for early contract termination.

Including clear information will help protect you from unfair or unlawful dismissal cases in the future.

  1. Include Information About and Links to Relevant Policies

Doing this will ensure employees have access to all the information they need about their job, your workplace, and what’s expected of them. In turn, this will protect you from legal action in the event of an accident or issue caused by failure to adhere to the relevant workplace policies.

 

In the end, it’s worth spending some time and money ensuring your new employment contracts are drafted correctly. Doing so will protect you from potential legal action in the future and ensure your employees understand exactly what their position entails. If you need help, we’d recommend speaking with an employment lawyer.