Moving into a new job can be an enormous step in your life, regardless of whether it is your first job or your twentieth. When a company makes you an offer, however, many people – especially young people – rush straight to an acceptance.
Rather than accepting the terms of your contract without a second thought, you should look through it thoroughly to establish whether it is right for you. In order to do so, however, first, you need to know what to look for. Many companies use an employment contract sample, meaning the essentials should be there.
Any employment contract should contain a clear and thorough description of the nature of the job, the number of hours, and the regular duties, as well as any expected less-regular duties. If a job description is vague or does not outline all of the duties expected of the employee, you should ask your employer and try to get the specifics in writing before you sign anything.
Job titles should also be included on employment contracts, as this shows your position in the company and tells other employees what your role is so that they know what to expect of you.
When many people think about compensation for their work, they often do not think past their salary or wages. While this is certainly a large part of the compensation that companies offer – an hourly or salaried rate offered for your time – there are numerous other benefits that fall under the umbrella of payment.
In terms of monetary compensation, bonuses, commission, and performance-related pay should all be laid out in the employment contract. Not only should the contract indicate how much these additional amounts will be, but what metrics employees are expected to reach in order to achieve them.
Some companies may also offer their employees shares in the company or profit-sharing schemes. If these are mentioned, it should be stated exactly how much you should expect to receive. Many companies also provide various insurances for their employees, such as healthcare and dental.
Many companies will implement non-compete and non-disclosure agreements in order to protect their business. Non-disclosure agreements (NDAs) prevent employees from legally divulging company information to people outside of the business, thus protecting important data and preventing insider trading.
Non-compete clauses prevent employees from working for competitors or starting their own company in the same field after leaving. The standard term for these clauses is six months, though it may be shorter or longer depending on the industry and the specific company. The longer a non-compete clause’s term is, however, the harder it is to enforce legally.
Companies enforcing non-compete agreements should realistically offer some form of compensation after the end of employment for the time in which you cannot work in the industry. You should always check your employment contract for these legal limitations, as failure to comply with them could result in immediate dismissal, hefty fines, and even jail time.
Any time off for employees, including the company’s policy on sick days, vacations, and general absences, should all be detailed in your employment contract. While vacation days are technically a part of your compensation package, they are normally stipulated separately within your employment contract, so you should check both sections.
You need to know whether or not you will receive sick pay in the event that you are too ill to work and, if so, how much. Your contract should also stipulate the number of vacation days you will receive per year and whether you have to use them before a certain date or can save them up over the years.
Under U.S. law, there are no minimum requirements for an employment contract, meaning that most employment is considered to be at-will and can be ended by either party at any time. Some employment contracts, however, may have a term where your employer will agree to give you work for a set amount of time, reevaluating your contract when your term ends.
This is a rare occurrence in many states; however, it is important to be aware of whether or not your employment contract stipulates a term and, if so, what the parameters are. Contracts with a term should also inform you of the ways in which you can extend your contract and what rules you will need to adhere to in order to avoid immediate dismissal.
While you often will not have a set term, employee classification also falls into this section. It should be stated whether you are an employee, a contractor, or a freelancer as your legal rights and the amount of tax you have to pay are both impacted by this.