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Frequently Asked Questions

What is an employment contract?An employment contract is a legally binding document that sets out the expectations, rights, and obligations that will govern the relationship between an employee and employer.When should I use an employment contract?A written employment contract should be used whenever an employment relationship is being created and the parties wish to minimize the potential for disputes or confusion by clearly establishing their rights and obligations.

Although oral agreements are a valid alternative, they are more likely to result in disagreement and will be more difficult to enforce should a dispute arise.
What is the difference between permanent and temporary employment?Under a permanent employment relationship there is no specified end date and the employment will continue until either party gives appropriate notice.

A temporary employment relationship will end on a fixed date. For example, contract or seasonal employees are considered temporary.
Can an employment contract be used for an independent contractor?No, you should use LawDepot’s Service Agreement if you will be hiring an independent contractor.
Your Employment ContractUpdate Preview


THIS EMPLOYMENT CONTRACT dated this 25th day of November, 2015


____________________ of ____________________
(the "Employer")


- AND -

____________________ of ____________________
(the "Employee")



  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 25th day of November, 2015 (the "Commencement Date").
  3. Job Title and Description
  4. The initial job title of the Employee will be the following: ____________________. The initial job duties the Employee will be expected to perform will be the following:
  5. 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.
  6. The Employee will perform any and all duties as requested by the Employer that are reasonable and that are customarily performed by a person holding a similar position in the industry or business of the Employer.
  7. 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 or after a notice period required under law.
  8. 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.
  9. Employee Compensation
  10. 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.
  11. 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.
  12. 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.
  13. The Employer will reimburse the Employee for all reasonable expenses, in accordance with the Employer's lawful policies 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.
  14. Place of Work
  15. The Employee's primary place of work will be at the following location:
    • __________, ____________________, ____________________, __________, __________.
  16. Time of Work
  17. The Employee's normal hours of work and breaks ("Normal Hours of Work") are as follows: ______________________________.
  18. Employee Benefits
  19. The Employee will be entitled to only those additional benefits that are currently available as described in the lawful provisions of the Employer's employment booklets, manuals, and policy documents 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.
  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.
  30. Contract Binding Authority
  31. 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.
  32. Termination Due to Discontinuance of Business
  33. 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.
  34. Termination of Employment
  35. Where there is just cause for termination, the Employer may terminate the Employee's employment without notice, as permitted by law.
  36. 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.
  37. If the Employee wishes to terminate this employment with the Employer, the Employee will provide the Employer with the greater of  one (1) week and the minimum required by law.  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.
  38. 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.
  39. 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.
  40. Remedies
  41. 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.
  42. Severability
  43. 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.
  44. Notices
  45. 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:




      __________, ____________________, __________, __________, __________




    • Employee:




      __________, ____________________, __________, __________, __________





  46. Modification of Agreement
  47. 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.
  48. Governing Law
  49. This Agreement will be construed in accordance with and governed by the laws of the state of Michigan.
  50. General Provisions
  51. Time is of the essence in this Agreement.
  52. 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.
  53. 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.
  54. 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.
  55. This Agreement may be executed in counterparts. Facsimile signatures are binding and are considered to be original signatures.
  56. 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 25th day of November, 2015.





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.

Related Documents:

Employment Contract Sample


Employment Contract

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