Advantages of Using Employment Contracts

Employment contracts can be very useful if you want control over the employee's ability to leave your business. For example, if finding or training a replacement will be very costly or time-consuming for your company, you might want a written contract. It can lock the employee into a specific term (for example, two years) or require the employee to give you enough notice to find and train a suitable replacement (for example, 90 days' notice). While you can't force someone to keep working for you, an employee is likely to comply with the agreement's terms if there's a penalty for not doing so.

Employment contracts might also make sense if the employee will be learning confidential and sensitive information about your business. You can insert confidentiality clauses that prevent the employee from disclosing the information or using it for personal gain. Similarly, a contract can protect you by preventing an employee from competing against you after leaving your company.

Sometimes, you can use an employment contract to entice a highly skilled candidate to come work for you instead of the competition. By promising the individual job security and beneficial terms in an employment contract, you can "sweeten the deal."

Finally, using an employment contract can give you greater control over the employee. For example, if the contract specifies standards for the employee's performance and grounds for termination, you may have an easier time terminating an employee who doesn't live up to your standards.

If you have questions about an employment contract or need help drafting one for your business call
Jason C. Foulger attorney at law 801-615-1951