Oh! You own a business in Philadelphia. You must be on top of the world. Of course, in the age where there is so much competition, running a business successfully deserves applause. But did you know that besides financial planning, marketing strategies, and brand building, there is one thing that you should never ignore?
That’s your employees! Of course, they are an integral part of any organization. Here it’s about creating employment contracts. This is an essential part of running a successful business.
Before we move on to the “why” part, first, let’s understand various hiring arrangements. Ideally, there are three types, part-time or full-time employees paid hourly or using a monthly salary, or independent contractors who provide companies with specific services, or interns or apprentices who work under highly skilled mentors.
Since the type of work they do varies, their employee contracts can’t be the same. Now let’s move on to the next part of this article.
Understanding All About Employment Contracts
A contract between an employer and employee is often termed as an “employee contract.” According to the business lawyer in Philadelphia, this is basically a document that introduces important terms and conditions and ensures that everyone understands their roles and responsibilities.
But do you have any idea what all needs to be there in the contract? If not, scroll down and learn more.
Include The Following Elements in an Employee Contract
Technically you need to include things as per the nature of employment. But the basics of almost all the types of contracts are similar. So, you must include information regarding:
- Wages –The contract must include all the specifications concerning payments. For instance, whether you’ll be paying at an hourly rate or a salary. You can also include info regarding commissions. Further, you must include payroll schedule information as well.
- Confidentiality- The contract must specify what all information needs to be confidential. For instance, you can include information regarding products, their development processes, customer lists, or any trade secrets. You need to mention for how long this confidentiality must be maintained.
- Working Ethics- This will specify what all is expected from the employee and include info regarding severance. This will also include details about termination clauses. And if the employee can join again after being terminated.
- Benefits- This will talk about additional benefits, such as health insurance or disability insurance. Other than that, it will also contain details about paid time offs or vacations. Not only that, but you might also include increment timelines or performance-based appraisals here.
Why Should You Have a Contract in Place?
As a matter of fact, if you are paying someone money, you should have proper documentation to avoid any hassles later on. The following are some of the instances where you should always go for employment contracts.
- You are hiring employees and wish to make them understand the company policies and know about it (on paper).
- You are designing innovative products and wish to keep them hidden until the launch time or have trade secrets that might hamper your business.
To grow your business, you need experts, specialists, and industry leaders. However, not everything can be done verbally. What if they could not perform as per your expectations? How can you converse with them without any legal document in place? So, make sure to include employee contracts as one of the prerequisites for smooth business operations within and outside the company.