5 Tips on Preparing an Employment Contract

Employment contract or, in some cases, the letter of employment should be prepared and reviewed carefully. An employment contract, by the way, is not the same as a letter of employment. The former is a more detailed document than the latter.

Here are some things to consider when preparing a contract of employment:
1. One of the most common concerns is if a document specifying the contract of employment should be given and what details should be included in the contract. Actually, there is no specific requirement for details of the contract to be put in writing. But there are some information that would be best included in the contract. They include the official title, salary or rate of pay, employment status, if there is a probationary period and the coverage of said period, the time and days that employee is expected to report for work, the name of the immediate supervisor or supervisors and pay frequency. You may add other information or remove some; it all depends on what your company needs or deems appropriate.
2. The contract of employment is typically given along with an employee handbook or details of the company’s policies. Most companies conduct a brief discussion of the policies along with the distribution of copies of the company policies. This handbook should contain a clear indication of what the company expects from the employee in terms of conduct, procedures and, in some cases, job performance. The detailed standards and procedures is a way for the company to manage risks and protect itself from claims of sex discrimination, illegal dismissal and adverse action, to name a few. The handbook should also contain the company’s declaration that harassment, bullying and other similar behavior will not be tolerated; and an assurance to complainants that their cases will be dealt in confidence and taken seriously. After the seminar discussing policies and the distribution of copies of the policy, the employer typically provides a form for employees to sign indicating that they have read and understood the company policy and that it was discussed with them by HR.
3. An employment contract should also contain details regarding the probationary period. A probationary period, which typically covers 3 months, should be mutually agreed upon by employer and employee. This period is to allow for both parties to have an idea if the employee is able to meet the job’s requirements or if the employee needs to be given additional training or guidance.
4. If your company uses surveillance equipment to keep track of daily processes, you should clearly indicate that in the contract of employment. This is to let the employee know that video or CCTV is in use in the workplace. Some companies prefer a notification of work surveillance that’s a separate document from the contract of employment. The bottom line is: you should inform your employee in writing.
5. An employment contract should also indicate the details on what the employee is entitled to. These include annual leaves, personal leaves, long service leave, sick leaves, parental leaves, vacation leaves and compassionate leaves.

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