In our last post, our blog began discussing how the conclusion of the hiring process can be an exciting time for you, the employer, as it frees you to focus on more pressing matters and, more significantly, start capitalizing on the strengths of your latest hire.
We also discussed how the one thing that may be standing in the way of this happening is the execution of an employment contract. To that end, we touched on terms that can be found in standard employment contracts and which employers of any size may want to consider including in their agreement with their prospective employee.
In the event an employer is concerned as to whether it’s even necessary to execute a contract — indeed the majority of U.S. employees do not execute them — it’s important to understand that there are considerable benefits to having certain new hires sign employment contracts.
- Retain their services for longer: If an employer has gone to great lengths to acquire the services of an employee and/or will invest considerable time and resources into training them, an employment contract enables them to maximize their investment. How? The employment contract can lock them in for a specific length of time or require them to provide notice much further in advance so that there is sufficient time to find a suitable replacement.
- Enjoy greater control: While it’s true that an employer cannot force an employee to stay with them, an employment contract does grant them the ability to control how the employee performs their job while there. Specifically, the employment contract can set forth expectations concerning both standards and other conditions, such that an employer is in a better position to discipline or, if necessary, terminate an employee who fails to live up to their duties.
- Protect your interests: If an employee will have access to client lists, trade secrets or other sensitive data, employment contracts can include measures designed to ensure that this information remains protected, including confidentiality clauses.
- Attract top talent: Thanks to principle of freedom of contract, employers can draft their contract however they wish in an attempt to beat out competitors and encourage top talent to join their ranks.
From employments contracts and employee manuals to handbooks and severance agreements, employers should give serious consideration to the idea of having a skilled legal professional review, amend or prepare all pertinent documentation as it can protect their interests and grant much-needed peace of mind.