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Frequently Asked Questions

Why have a written Employment Contract?An Employment Contract clearly sets out the expectations, rights and obligations between an Employee and an Employer.

The problem with oral agreements is that they are difficult to prove. If a dispute arose, a court would have to hear evidence and decide whose version of the truth to accept. If there is a written agreement, courts will generally be obligated to uphold its terms even if they don't like them.

What is permanent or indefinite employment?An indefinite or permanent employment is where there is no specified termination or end date. The employment continues until either party gives appropriate notice.
What is fixed term employment?Fixed period or fixed term employment is where there is specified start and end date. There is no need to give notice of termination of employment as the employment automatically ends on the end date.
Your Employment ContractUpdate Preview

EMPLOYMENT CONTRACT

THIS EMPLOYMENT CONTRACT dated this 2nd day of September, 2014

BETWEEN:

_________________________ of ____________________
(the "Employer")

OF THE FIRST PART

- AND -

_________________________ of ____________________
(the "Employee")

OF THE SECOND PART

BACKGROUND:

  1. The Employer is of the opinion that the Employee has the necessary qualifications, experience and abilities to assist and benefit the Employer in its business.
  2. The Employer desires to employ the Employee and the Employee has agreed to accept and enter such employment upon the terms and conditions set out in this Agreement.

IN CONSIDERATION OF the matters described above and of the mutual benefits and obligations set forth in this Agreement, the receipt and sufficiency of which consideration is hereby acknowledged, the parties to this Agreement agree as follows:

  1. Commencement Date and Term
  2. The Employee will commence permanent full-time employment with the Employer on the 2nd day of September, 2014 (the "Commencement Date").
  3. The Employee must successfully complete a probationary period of three (3) months (the 'Probationary Period') beginning on the Commencement Date. At any time during the Probationary Period, as and where permitted by law, the Employer will have the right to terminate employment without any notice or compensation to the Employee other than wages owed for hours of work already completed.
  4. Job Title and Description
  5. The Employer agrees to employ the Employee as a ____________________. The Employee will be expected to perform the following job duties:
    ____________________________________________________________
  6. The Employee agrees to be employed on the terms and conditions set out in this Agreement. The Employee agrees to be subject to the general supervision of and act pursuant to the orders, advice and direction of the Employer.
  7. The Employee will perform any and all duties that are reasonable and that are customarily performed by a person holding a similar position in the industry or business of the Employer.
  8. The Employer cannot unilaterally and significantly change the Employee's job title or duties. The Employer may make changes to the job title or duties of the Employee where the changes would be considered reasonable for a similar position in the industry or business of the Employer. The Employee's job title or duties may be changed by agreement and with the approval of both the Employee and the Employer.
  9. The Employee agrees to abide by the Employer's rules, regulations, and practices, including those concerning work schedules, vacation and sick leave, as they may from time to time be adopted or modified.
  10. Employee Compensation
  11. Compensation paid to the Employee for the services rendered by the Employee as required by this Agreement (the "Compensation") will include a wage at the rate of $0.00 (USD) per hour as well as any compensation paid for Overtime Hours.
  12. This Compensation will be payable twice per month while this Agreement is in force. The Employer is entitled to deduct from the Employee's Compensation, or from any other compensation in whatever form, any applicable deductions and remittances as required by law.
  13. The Employee understands and agrees that any additional compensation paid to the Employee in the form of bonuses or other similar incentive compensation will rest in the sole discretion of the Employer and that the Employee will not earn or accrue any right to incentive compensation by reason of the Employee's employment.
  14. In cases where Overtime Hours are worked in a period, overtime will be paid as required by law.
  15. The Employer will reimburse the Employee for all reasonable expenses, in accordance with the Employer's policy as in effect from time to time, including but not limited to, any travel and entertainment expenses incurred by the Employee in connection with the business of the Employer. Expenses will be paid within a reasonable time after submission of acceptable supporting documentation.
  16. Place of Work
  17. The Employee's primary place of work will be at the following location:
    • ______________________________.
  18. Employee Benefits
  19. The Employee will be entitled to only those additional benefits that are currently available as described in the Employer's employment booklets and manuals or as required by law.
  20. Employer discretionary benefits are subject to change, without compensation, upon the Employer providing the Employee with 60 days written notice of that change and providing that any change to those benefits is taken generally with respect to other employees and does not single out the Employee.
  21. Vacation
  22. The Employee will be entitled to two weeks of paid vacation each year during the term of this Agreement, or as entitled by law, whichever is greater.
  23. The times and dates for any vacation will be determined by mutual agreement between the Employer and the Employee.
  24. Upon termination of employment, the Employer will pay compensation to the Employee for any accrued and unused vacation days.
  25. Duty to Devote Full Time
  26. The Employee agrees to devote full-time efforts, as an employee of the Employer, to the employment duties and obligations as described in this Agreement.
  27. Conflict of Interest
  28. During the term of the Employee's active employment with the Employer, it is understood and agreed that any business opportunity relating to or similar to the Employer's actual or reasonably anticipated business opportunities (with the exception of personal investments in less than 5% of the equity of a business, investments in established family businesses, real estate, or investments in stocks and bonds traded on public stock exchanges) coming to the attention of the Employee, is an opportunity belonging to the Employer. Therefore, the Employee will advise the Employer of the opportunity and cannot pursue the opportunity, directly or indirectly, without the written consent of the Employer, which consent will not be unreasonably withheld.
  29. During the term of the Employee's active employment with the Employer, the Employee will not, directly or indirectly, engage or participate in any other business activities that the Employer, in its reasonable discretion, determines to be in conflict with the best interests of the Employer without the written consent of the Employer, which consent will not be unreasonably withheld.
  30. Non-Solicitation
  31. The Employee understands and agrees that any attempt on the part of the Employee to induce other employees or contractors to leave the Employer's employ, or any effort by the Employee to interfere with the Employer's relationship with its other employees and contractors would be harmful and damaging to the Employer. The Employee agrees that during the Employee's term of employment with the Employer and for a period of two (2) years after the end of that term, the Employee will not in any way, directly or indirectly:
    1. Induce or attempt to induce any employee or contractor of the Employer to quit employment or retainer with the Employer;
    2. Otherwise interfere with or disrupt the Employer's relationship with its employees and contractors;
    3. Discuss employment opportunities or provide information about competitive employment to any of the Employer's employees or contractors; or
    4. Solicit, entice, or hire away any employee or contractor of the Employer for the purpose of an employment opportunity that is in competition with the Employer.
  32. This non-solicitation obligation as described in this section will be limited to employees or contractors who were employees or contractors of the Employer during the period that the Employee was employed by the Employer.
  33. During the term of the Employee's active employment with the Employer, and for two (2) years thereafter, the Employee will not divert or attempt to divert from the Employer any business the Employer had enjoyed, solicited, or attempted to solicit, from its customers, prior to termination or expiration, as the case may be, of the Employee's employment with the Employer.
  34. Confidential Information
  35. The Employee acknowledges that, in any position the Employee may hold, in and as a result of the Employee's employment by the Employer, the Employee will, or may, be making use of, acquiring or adding to information which is confidential to the Employer (the "Confidential Information") and the Confidential Information is the exclusive property of the Employer.
  36. The Confidential Information will include all data and information relating to the business and management of the Employer, including but not limited to, proprietary and trade secret technology and accounting records to which access is obtained by the Employee, including Work Product, Computer Software, Other Proprietary Data, Business Operations, Marketing and Development Operations, and Customer Information.
  37. The Confidential Information will also include any information that has been disclosed by a third party to the Employer and is governed by a non-disclosure agreement entered into between that third party and the Employer.
  38. The Confidential Information will not include information that:
    1. Is generally known in the industry of the Employer;
    2. Is now or subsequently becomes generally available to the public through no wrongful act of the Employee;
    3. Was rightfully in the possession of the Employee prior to the disclosure to the Employee by the Employer;
    4. Is independently created by the Employee without direct or indirect use of the Confidential Information; or
    5. The Employee rightfully obtains from a third party who has the right to transfer or disclose it.
  39. The Confidential Information will also not include anything developed or produced by the Employee during the Employee's term of employment with the Employer, including but not limited to, any intellectual property, process, design, development, creation, research, invention, know-how, trade name, trade-mark or copyright that:
    1. Was developed without the use of equipment, supplies, facility or Confidential Information of the Employer;
    2. Was developed entirely on the Employee's own time;
    3. Does not result from any work performed by the Employee for the Employer; and
    4. Does not relate to any actual or reasonably anticipated business opportunity of the Employer.
  40. Duties and Obligations Concerning Confidential Information
  41. The Employee agrees that a material term of the Employee's contract with the Employer is to keep all Confidential Information absolutely confidential and protect its release from the public. The Employee agrees not to divulge, reveal, report or use, for any purpose, any of the Confidential Information which the Employee has obtained or which was disclosed to the Employee by the Employer as a result of the Employee's employment by the Employer. The Employee agrees that if there is any question as to such disclosure then the Employee will seek out senior management of the Employer prior to making any disclosure of the Employer's information that may be covered by this Agreement.
  42. The Employee agrees and acknowledges that the Confidential Information is of a proprietary and confidential nature and that any disclosure of the Confidential Information to a third party in breach of this Agreement cannot be reasonably or adequately compensated for in money damages, would cause irreparable injury to Employer, would gravely affect the effective and successful conduct of the Employer's business and goodwill, and would be a material breach of this Agreement.
  43. The obligations to ensure and protect the confidentiality of the Confidential Information imposed on the Employee in this Agreement and any obligations to provide notice under this Agreement will survive the expiration or termination, as the case may be, of this Agreement and will continue for a period of five (5) years from the date of such expiration or termination.
  44. The Employee may disclose any of the Confidential Information:
    1. To a third party where Employer has consented in writing to such disclosure; and
    2. To the extent required by law or by the request or requirement of any judicial, legislative, administrative or other governmental body.
  45. If the Employee loses or makes unauthorized disclosure of any of the Confidential Information, the Employee will immediately notify the Employer and take all reasonable steps necessary to retrieve the lost or improperly disclosed Confidential Information.
  46. Ownership and Title to Confidential Information
  47. The Employee acknowledges and agrees that all rights, title and interest in any Confidential Information will remain the exclusive property of the Employer. Accordingly, the Employee specifically agrees and acknowledges that the Employee will have no interest in the Confidential Information, including, without limitation, no interest in know-how, copyright, trade-marks or trade names, notwithstanding the fact that the Employee may have created or contributed to the creation of the Confidential Information.
  48. The Employee waives any moral rights that the Employee may have with respect to the Confidential Information.
  49. The Employee agrees to immediately disclose to the Employer all Confidential Information developed in whole or in part by the Employee during the Employee's term of employment with the Employer and to assign to the Employer any right, title or interest the Employee may have in the Confidential Information. The Employee agrees to execute any instruments and to do all other things reasonably requested by the Employer, both during and after the Employee's employment with the Employer, in order to vest more fully in the Employer all ownership rights in those items transferred by the Employee to the Employer.
  50. Return of Confidential Information
  51. The Employee agrees that, upon request of the Employer or upon termination or expiration, as the case may be, of this employment, the Employee will turn over to the Employer all Confidential Information belonging to the Employer, including but not limited to, all documents, plans, specifications, disks or other computer media, as well as any duplicates or backups made of that Confidential Information in whatever form or media, in the possession or control of the Employee that:
    1. May contain or be derived from ideas, concepts, creations, or trade secrets and other proprietary and Confidential Information as defined in this Agreement; or
    2. Is connected with or derived from the Employee's employment with the Employer.
  52. Contract Binding Authority
  53. Notwithstanding any other term or condition expressed or implied in this Agreement to the contrary, the Employee will not have the authority to enter into any contracts or commitments for or on the behalf of the Employer without first obtaining the express written consent of the Employer.
  54. Termination Due to Discontinuance of Business
  55. Notwithstanding any other term or condition expressed or implied in this Agreement, in the event that the Employer will discontinue operating its business at the location where the Employee is employed, then, at the Employer's sole option, and as permitted by law, this Agreement will terminate as of the last day of the month in which the Employer ceases operations at such location with the same force and effect as if such last day of the month were originally set as the Termination Date of this Agreement.
  56. Termination of Employment
  57. Where the Employee has breached any reasonable term of this Agreement or where there is just cause for termination, the Employer may terminate the Employee's employment without notice, as permitted by law.
  58. The Employee and the Employer agree that reasonable and sufficient notice of termination of employment by the Employer is the greater of one (1) week or any minimum notice required by law.
  59. If the Employee wishes to terminate this employment with the Employer, the Employee will provide the Employer with notice of one (1) week. As an alternative, if the Employee co-operates with the training and development of a replacement, then sufficient notice is given if it is sufficient notice to allow the Employer to find and train the replacement.
  60. The Termination Date specified by either the Employee or the Employer may expire on any day of the month and upon the Termination Date the Employer will forthwith pay to the Employee any outstanding portion of the wage, accrued vacation and banked time, if any, calculated to the Termination Date.
  61. Once notice has been given by either party for any reason, the Employee and the Employer agree to execute their duties and obligations under this Agreement diligently and in good faith through to the end of the notice period. The Employer may not make any changes to wages, wage rate, or any other term or condition of this Agreement between the time termination notice is given through to the end of the notice period.
  62. Remedies
  63. In the event of a breach or threatened breach by the Employee of any of the provisions of this Agreement, the Employee agrees that the Employer is entitled to a permanent injunction, in addition to and not in limitation of any other rights and remedies available to the Employer at law or in equity, in order to prevent or restrain any such breach by the Employee or by the Employee's partners, agents, representatives, servants, employees, and/or any and all persons directly or indirectly acting for or with the Employee.
  64. Severability
  65. The Employer and the Employee acknowledge that this Agreement is reasonable, valid and enforceable. However, if any term, covenant, condition or provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, it is the parties' intent that such provision be changed in scope by the court only to the extent deemed necessary by that court to render the provision reasonable and enforceable and the remainder of the provisions of this Agreement will in no way be affected, impaired or invalidated as a result.
  66. Notices
  67. Any notices, deliveries, requests, demands or other communications required here will be deemed to be completed when hand-delivered, delivered by agent, or seven (7) days after being placed in the post, postage prepaid, to the parties at the following addresses or as the parties may later designate in writing:
    • Employer:

      Name:

      _________________________

      Address:

      ____________________

      Fax:

       

      Email:

       
    • Employee:

      Name:

      _________________________

      Address:

      ____________________

      Fax:

       

      Email:

       
  68. Modification of Agreement
  69. Any amendment or modification of this Agreement or additional obligation assumed by either party in connection with this Agreement will only be binding if evidenced in writing signed by each party or an authorized representative of each party.
  70. Governing Law
  71. This Agreement will be construed in accordance with and governed by the laws of the state of Virginia.
  72. Definitions
  73. For the purpose of this Agreement the following definitions will apply:
    1. "Overtime Hours" means the total hours worked in a day or week in excess of the maximum allowed, as defined by local statute, for a work day or a work week.
    2. 'Work Product' means work product information, including but not limited to, work product resulting from or related to work or projects performed or to be performed for the Employer or for clients of the Employer, of any type or form in any stage of actual or anticipated research and development.
    3. 'Computer Software' means computer software resulting from or related to work or projects performed or to be performed for the Employer or for clients of the Employer, of any type or form in any stage of actual or anticipated research and development, including but not limited to, programs and program modules, routines and subroutines, processes, algorithms, design concepts, design specifications (design notes, annotations, documentation, flowcharts, coding sheets, and the like), source code, object code and load modules, programming, program patches and system designs.
    4. 'Other Proprietary Data' means information relating to the Employer's proprietary rights prior to any public disclosure of such information, including but not limited to, the nature of the proprietary rights, production data, technical and engineering data, test data and test results, the status and details of research and development of products and services, and information regarding acquiring, protecting, enforcing and licensing proprietary rights (including patents, copyrights and trade secrets).
    5. 'Business Operations' means operational information, including but not limited to, internal personnel and financial information, vendor names and other vendor information (including vendor characteristics, services and agreements), purchasing and internal cost information, internal services and operational manuals, and the manner and methods of conducting the Employer's business.
    6. 'Marketing and Development Operations' means marketing and development information, including but not limited to, marketing and development plans, price and cost data, price and fee amounts, pricing and billing policies, quoting procedures, marketing techniques and methods of obtaining business, forecasts and forecast assumptions and volumes, and future plans and potential strategies of the Employer which have been or are being considered.
    7. 'Customer Information' means customer information, including but not limited to, names of customers and their representatives, contracts and their contents and parties, customer services, data provided by customers and the type, quantity and specifications of products and services purchased, leased, licensed or received by customers of the Employer.
    8. 'Termination Date' means the date specified in this Agreement or in a subsequent notice by either the Employee or the Employer to be the last day of employment under this Agreement. The parties acknowledge that various provisions of this Agreement will survive the Termination Date.
  74. General Provisions
  75. Time is of the essence in this Agreement.
  76. Headings are inserted for the convenience of the parties only and are not to be considered when interpreting this Agreement. Words in the singular mean and include the plural and vice versa. Words in the masculine mean and include the feminine and vice versa.
  77. No failure or delay by either party to this Agreement in exercising any power, right or privilege provided in this Agreement will operate as a waiver, nor will any single or partial exercise of such rights, powers or privileges preclude any further exercise of them or the exercise of any other right, power or privilege provided in this Agreement.
  78. This Agreement will inure to the benefit of and be binding upon the respective heirs, executors, administrators, successors and assigns, as the case may be, of the Employer and the Employee.
  79. This Agreement may be executed in counterparts. Facsimile signatures are binding and are considered to be original signatures.
  80. This Agreement constitutes the entire agreement between the parties and there are no further items or provisions, either oral or written. The parties to this Agreement stipulate that neither of them has made any representations with respect to the subject matter of this Agreement except such representations as are specifically set forth in this Agreement.

IN WITNESS WHEREOF, the parties have duly affixed their signatures under hand and seal on this 2nd day of September, 2014.

EMPLOYER:

_________________________ (Print)

Per:______________________(SEAL)



EMPLOYEE:

______________________________

_________________________ (Print)

Employment Contract Information

Alternate Names:

An Employment Contract is also known as:

  • Employment Agreement
  • Contract of Employment
  • Employee Contract
  • Job Contract

What is an Employment Contract?

An Employment Contract is what employers and employees use to clearly outline the rights, responsibilities, and obligations of the parties during the work period.

It may include information about compensation (pay/wage), vacation time, the job description and duties, probationary periods, duties of confidentiality, termination procedures, and information about both the employee and employer.

Who Needs an Employment Contract?

Employment Contracts should be used by:

  • Employers, HR (human resources) Managers, and Recruitment Officers who are preparing to enlist a new hire
  • Employees/new hires/recruits whose employers do not use or have any type of job contract

Types of Employment

Employees are people who work for a business and who receive monetary compensation from the employer in return for their services. Since there are various types of employment, you will need to ensure that you are classifying your workers properly in any contracts that you create with them.

Employment types include:

Permanent Full Time: A permanent full time employee is someone who will be meeting the requirements for full time hours and who has no predetermined end date to his or her employment.

Permanent Part Time: A permanent part time employee is someone who will not be meeting the requirements for full time hours and who also has no predetermined end date to his or her employment.

Fixed Period or Term: An employee who is on a fixed period or fixed term employment has a prearranged end date to their employment. The contract automatically expires on the end date, and no notice is required from either party to end the employment at that time.

What is a Probationary Period?

It is common for employers to require that a new employee complete a probationary period of 3 months or more.

This period is used to determine if the employee will fit with the company's goals, if they have the necessary skills to perform the required tasks, and if the employer or manager believes that they are capable of being a part of the company long-term.

An employer may terminate its working relationship with the employee at any time during the probationary period without cause and without need to provide notice or severance pay.

After the probation ends, and the company has decided to continue to employ the new hire, the employee qualifies for any health or other benefits that other workers of the same nature within the company receive.

Once the employee has passed their probation, the company is then required to either have just cause to terminate an employee or to provide adequate notice upon termination and/or severance pay to the employee.

Non-Compete, Non-Solicitation, and Confidentiality Clauses

Employers will often include non-compete, non-solicitation, and confidentiality clauses in their Employment Contracts. These clauses serve to protect the employer from many different circumstances that could otherwise cause the company to lose business, employees, and trade secrets.

Non-Compete (or Non-Competition): A non-compete clause keeps the employee from working for direct competitors of the business during and after their work relationship has ended. Non-compete clauses generally last for a certain amount of time post-termination, and must meet certain requirements to be enforced, such as being limited to a reasonable geographic location.

Non-Solicitation: A non-solicitation clause keeps the employee from encouraging other employees or customers/clients of the employer to move to another company or service provider. These clauses must also meet certain restrictions to be considered valid, and generally last for a predetermined amount of time (such as 2 or 3 years from the end of the employment relationship).

Confidentiality: A confidentiality clause keeps confidential work information private. It bars the employee (or former employee) from discussing or using company secrets, marketing plans, and product information without the express permission of the company.

Confidentiality clauses can either last indefinitely (until the information enters the public domain through a third party), or have an expiration date (for example, 2 years after the contract ends).

Any clause that you include in your Employment Contract must be fair and reasonable to both parties, as well as legal, to be considered enforceable in a court of law.

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