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What Terms Should be Included in an Employment Contract?


Question: What Terms Should be Included in an Employment Contract?

Most employers require administrative and professional employees to sign an employment agreement. The agreement sets out the duties of the employee and employer, and provides the employer with the opportunity to clarify the relationship, as well as including restrictive covenants to protect the employer from competition.


Although the specific terms or articles required in an employment contract vary by state and by type of employment, the following terms and conditions are usual in these types of agreements:

  • Identification of the parties, including, in some cases, addresses
  • Effective Date of the agreement
  • Type of employment (full-time , professional, type of services provided by the employee
  • Duties of the employee, including maintenance of professional licenses, ethical actions
  • Extent of Services, including hours and days of work
  • Benefits provided to the employee. These may be specific or the agreement may refer to an employee handbook or benefits listing for all employees
  • Termination, describing the circumstances under which either party may terminate the relationship, and the notice required
  • Non compete agreement, restricting the employee's competition with the employer during or after termination
  • Non solicitation agreement, in which the employee agrees not to solicit employer's customers or other employees
  • Confidentiality agreement, in which the employee agrees to keep trade secrets, proprietary information private
  • Notices - How notices of actions must be sent and received by each party
  • Severability - If one part of the contract is found to be invalid, the rest of the contract remains valid
  • Applicable law - which state law is applicable
  • Entire agreement - that this is the entire agreement, and there is nothing else that may be included

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