An employment contract is an agreement between an employer and employee which sets out the terms and conditions of an employee’s employment. It is important for both an employer and employee to have a clear understanding of the terms and conditions of the employee’s employment to avoid disputes from arising.
No. An employment contract can be made verbally or it can be made in writing.
It can also be a mixture of a verbal agreement and a written agreement. The signing of a written employment contract, however, will assist in establishing that an employment relationship has been created.
An employment contract will be valid and legally enforceable where:
The contents of an employment contract will vary depending on the nature of the work to be performed by an employee. Generally, however, a standard employment contract will include:
An employer should provide a person with a copy of the employment contract when they offer them employment so the employee can consider the terms and conditions of employment before accepting the position.
The National Employment Standards (‘NES’) are ten minimum employment entitlements that must be provided to all employees. An employment contract cannot provide for less than the minimum employment entitlements set out in the NES. A written employment contract does not need to explicitly include the NES clauses.
While an employer and employee may be bound by a modern award or enterprise bargaining agreement, each term of that award or agreement is not necessarily a term of a valid employment contract.
As with the NES, modern awards set out minimum employment standards. An employment contract cannot provide for less than these minimum standards but it may contain conditions that are more beneficial to an employee.
Generally, policies and procedures will be considered to have contractual force if they are referenced in a written employment contract or letter of offer. Where the contract is a verbal contract, an employee may be given a policy handbook or manual and asked to sign a receipt. This will generally indicate an acceptance of its terms.
An employer and employee may agree to change the terms of the employee’s employment at any time provided this is an agreement made by both parties. In other words, an employer cannot vary the terms of an employee’s employment unilaterally.
Where there is a significant change to the terms of an employee’s duties, this may constitute a substitution of the original employment contract with a new employment contract. Where this occurs, the terms of the original employment contract may no longer be applicable.
Employment contracts can be difficult and complex depending on the nature of the employment. Should you wish to obtain legal advice in relation to an employment contract you should contact a Gilshenan & Luton employment lawyer who will assist you with your matter.