As the owner of a small business in New York, you could benefit from entering into written contracts with some of your employees. But in what way?
One of the key reasons to enter into a contract is that it enables you to retain your best employees for a specified period of time. You can accomplish that by limiting the reasons why an employee may leave your employ.
A contract also benefits you as an employer when the employee has access to your trade secrets. If that’s the case, the contract could include a confidentiality clause that means the employee can’t disclose pertinent information about your company to a third party. You also could include a noncompete clause, which means the employee can’t work for a competitor for a set amount of time after leaving your company.
The ability to offer a contract also would allow you to bring the best workers to your company. A professional might be lured to leave another company for yours if you can offer a contract that gives job stability and other benefits.
Just what should be included in the contract?
- Job description and salary
- Job responsibilities
- Length of contract
- Benefits, such as medical insurance, retirement accounts, vacation and sick pay
- Grounds for termination
- Noncompete clauses
- Nondisclosure agreement concerning trade secrets
- The stipulation that anything produced by the employee while working at your company is your property, or that any patents gained by the employee while working for you are assigned to your company
- The method by which you’ll resolve any disputes, which could include mediation or arbitration
Remember that when you ask an employee to sign a contract that recognizes the above conditions, you must give something in return. If you want to discharge an employee because they aren’t doing the job as you expected or if your business doesn’t have a role for the employee anymore, you must renegotiate the terms of the contract.
Employment contracts should be reviewed by your company attorney before you enter into them to make sure that you are offering a fair pact to your employee while also protecting your own interests.