Searching for a new employee can be a long process. But it doesn’t stop once the employer has found the perfect candidate. Once the employer has decided to hire, the next step should include getting the new employee to sign a written employment contract. A written employment contract is important because it safeguards employers from unpleasant future surprises. In this article, we list three types of provisions that will help minimize certain types of unwanted situations.
- Job description provisions
Employers should be cautious of the level of detail in the job description of an employment contract. If an employee is assigned an additional task outside the scope of the job description, the employee has the right to refuse the additional responsibility. Depending on the additional task assigned, an employee’s refusal to perform can result in a constructive dismissal. A constructive dismissal means that an employer has changed the fundamental nature of the job so significantly that the employer has effectively terminated the employee. In that situation, the employer would owe the employee notice or pay in lieu of notice.
To avoid this situation, an employer should have a carefully drafted job description with language that can accommodate foreseeable changes in employee responsibilities.
- Non-compete and non-disclosure clauses
Non-compete and non-disclosure clauses can protect an employer’s business. Non-compete clauses limit a prior employee from using specific knowledge or skills gained from his or her past employer’s workplace at a competing business. Non-compete clauses are great for employers but should be drafted very carefully. Typically, courts scrutinize non-compete clauses to ensure that the clause does not limit a person from making a living. Non-compete clauses should be limited to reasonably protecting the employer’s proprietary interest, as well as being reasonably limited in duration and geographical scope.
Non-disclosure clauses are similar to non-compete clauses in that they prevent a prior employee from revealing specific information gained from his or her past employer to the public. All of the things said above with regards to non-compete clauses are equally applicable to non-disclosure clauses. Non-disclosure clauses can protect an employer from an employee revealing trade secrets about the business’ unique product or service.
- Dispute mediation clauses
A mediation clause prevents the agreed parties from immediately going to court. Mediation is an informal process where the parties try to resolve their dispute with the help of an impartial third party (the mediator). By including a mandatory mediation clause within the employment contract, the employer can try to resolve disputes amicably and avoid trial.
Trials are often disadvantageous to all parties involved. Trials can be expensive, time-consuming, and most importantly, trials are also public record – meaning potential negative publicity.
On the other hand, mediation is more beneficial because the parties hold control over the entire process. Mediation can be quicker and cheaper than court because the parties have the autonomy to choose whether to accept a settlement and bring the dispute to an end. All discussions within mediation can also be private so that the employer’s reputation will not be at risk.
While bringing on a new employee can have many benefits for a business, employers should also be aware of the additional risks. A carefully drafted written employment contract can help manage these risks and protect businesses. If you are an employer or an employee negotiating an employment contract, our Business Lawyers can help. Contact Hazlo Law – Business Lawyers today.
This article is for informational purposes only and does not constitute legal advice. If you wish to discuss your issue with a lawyer, contact Hugues today. 613-747-2459 ext.304, [email protected]