Employment Contract: What you need to know

What is an Employment Contract?


An employment contract (also known as the contract of employment) is a fundamental type of contract used in labor law to elucidate the relationship (rights and responsibilities) that exist between an employee and his or her employer. In a general sense, the employment contract affirms a relationship of economic dependence and social adherence in regards to appropriate workplace behavior.The employment contract is a legally binding agreement, made between the employer and the hired employee.

The employment contract states the intricacies of the specific employment and the particular rules that would necessitate a termination. The employment contract establishes the terms of the employment relationship; it legally upholds and indicates the employees pay, the expected responsibilities and duties that the employee must satisfy, the appropriate dress code of the office, the amount of sick/vacation days the employee is given and in general, a conduct policy that the employee must abide by. Furthermore, the employment contract will also detail the rights awarded to the employee and will illustrate upon the punishments, such as termination, if the policy or employment contract, is breached in any way.The employment contract, in most instances, will be enforced so long as the terms are not egregious; outlandish policies refer to any instance that violates worker-protection legislation. In summation, the employment contract will dictate aspects of the behavior of both the employee and his or her employer.


What is an Employment Contract Breach?


An employment contract breach is a situation where either the employee or the underlying employer fails to comply with the provisions found in the employment contract. All employment contracts are legally binding agreements that govern the relationship between the two parties; if either party fails in fulfilling the terms of the agreement, a breach has occurred. The penalties of the breach will vary, depending on the severity of the breach. For instance, if an employee is habitually late and tardiness is not tolerated in the employment contract, the individual may be terminated. In a more severe case, if the employee was partaking in an illegal activity, such as insider trading, the employer will seek a legal remedy through the state’s court system. In the majority of countries an employment contract breach will apply to both the implied and expressed provisions of the agreement; this makes it necessary for both parties to adhere to the terms of the employment contract, along with any governmental regulations that apply to the employment.