Did you know that when you hire an employee in exchange for a salary it automatically implies the existence of an employment contract? A verbal agreement or a written contract are both considered employment contracts. Although the Act respecting labour standards does not require it to be written, it is preferable to use this method to ensure that working conditions are well explained and understood. Moreover, a written contract will be stronger evidence before the court in the event of a disagreement.
What should I include in an employment contract?
Title and job description: present a clear picture of the employee’s main functions.
Schedule and duration of work: Specify the hours of the work week, the allowable time for breaks as well as compensation arrangements related to working overtime. If the contract is for a fixed term, make sure to indicate the start and end dates of the contract.
Compensation and benefits: set the salary, method of payment of salary, pay period and additional monetary benefits such as commission, bonus and tips. Specify the group insurance terms, pension plan and other benefits including the qualifying period for these programs.
Vacation and sick days: State the length of vacation to which the employee is entitled and the reference period used to calculate the allocation. If your business activities are seasonal, make sure to add the period during which they are not allowed to take vacation, or the period when employees must take vacation due to an annual company closure.
If you wish to further elaborate the employment contract, you can include a non-disclosure and non-compete clause (NDNC). These will allow you to inform future employees of the restrictions related to the disclosure of your confidential information and involvement with similar business activities during their employment and within a reasonable period of time following their cessation. You can also add an intellectual property clause defining your exclusive rights to the company’s assets and belongings. Just be advised that these clauses are subject to strict legal rules in order for them to be upheld in court.
Always keep in mind that any contract is void if the conditions are below the standards set by the Act respecting labour standards and the Quebec Civil Code. It may be easy and quick to settle on a verbal agreement, however, a written contract remains the most advantageous practice for both parties!
HR Connection – Fall 2014
Ask an HR Expert – Fall 2014
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