Establishing an Effective Employer-Employee Relationship

An employment contract is a bilateral agreement between an employer and the employee. This agreement outlines the duration that is agreed between the employer and the employee for the exchange of services and remuneration, and also clearly demarcates the scope of work, the rights, and responsibilities of the two. Such a type of contract is signed between the employer and the employee and also in some cases, between the employee and a labor union too. This employment contract is very important since it establishes various such provisions which are helpful for an effective and smooth run of the corporation or industry. Why this employment contract is very important is because it also demarcates the right of the employee or the worker and also the obligation with respect to the employer over the employee concerning the payment and other facilities. Hence, such a contract becomes important for both employer and employee.

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Understanding the nuances of the Employment Contract

Such a contract is really important for an industry that engages hundreds and thousands of employees. This agreement provides a structure of the functioning and the effective relationship between the company and the employee. The contract must include all such provisions which will be helpful in the smooth conduct of the business.

The employment contract must contain the basic rules and regulations which are important for the conduct of the business and must be made understood by the employee. The contract must specify the working hours of the worker and when the worker will be expected to work overtime. The contract will include the details with regards to the salary or wages. Either a fixed amount or the amount can vary with hours. So, if the employee will work overtime then the amount must be dependent upon the hourly work. Such a type of contract always leads to fewer disputes among the management and workers leading to a conducive environment.

The duration of the employment must be mentioned in the contract. Mostly the employees being hired are on a contractual basis. This means that the term of employment is very important to mention in the contract to not create any such dispute while terminating the contract. Even if there are chances that the period might be extended or renewed, it must be mentioned in the contract. The process and the criteria upon which the renewal will be based must be mentioned. Criteria include performance-based work or other criteria. This must be mentioned since it will help the employee to work in the best possible manner. Moreover, the employee must be aware of the benefits that are associated with the work. Various industries provide health and family insurance of some amount in case of injury or death. Such benefits must be mentioned in the contract ensuring that they know the same.

The contract must contain the general responsibilities of the employee. What all will be expected by the employee in the due course of time must be mentioned in the contract. Provisions like that of keeping confidentiality must be adhered to. It can also be done while signing a separate Non-Disclosure Agreement with regards to confidentiality. There are a lot of benefits of getting and ratifying an employment contract. The primary benefit that we all see is defining clear terms and conditions. Both the party knows the terms with which they are bound with. Having clear terms also helps in solving any such dispute which might arise in the future. The clarity in terms and conditions provide stability in the functioning of the business. Such provisions being legally binding are beneficial to both employer and employee, in case of any breach.

IPLF

The team at IP and Legal Filings (IPLF) understands the complexities of such contracts and hence assists in providing a clear and concise contract drafted and vetted by our specialized drafting team. The team is aware of the fact that the drafting of the terms and conditions should be clear and concise, along with ensuring that the objective of a written understanding in the form of a contract is done for both parties, which would help adjudicate upon any further issue that might arise between the parties.

Author: Saransh Chaturvedi (an advocate) currently pursuing LLM from Rajiv Gandhi School of Intellectual Property Law (IIT Kharagpur).  In case of any queries please contact/write back to us at support@ipandlegalfilings.com.