When lawyers and HR specialists talk about employment contracts it’s surprising how many people still relate the term ‘contract’ to a written document, even though the ‘contract’ may be verbal or even only implied.
A written employment contract, however, provides both the employer and the employee with a detailed description of the employee’s position, responsibilities and obligations to the employer. A properly constructed employment contract, therefore, provides a framework for the employee to operate within and a mechanism for an employer to clearly identify when someone is failing to operate to the full expectations and requirements of their job specification.
I hear you cry, “Job Description!”, but the job description doesn’t include general obligations such as attendance, dress, fitness to work, location of work and a myriad of other considerations. A job description is specific to the productive contribution an employee is expected to make to an organisation, whereas an employment contract includes a wider sphere of activity, sometimes including what an employee is or is not able to do at, or even after, termination of employment.
An employment contract will typically include an obligation to return company information and other property and may include a covenant to prevent the employee entering into similar and competitive employment for a fixed period.
The employment contract is not the same as the statutory written statement, which confuses many people until they appreciate that the statutory written statement is a general document while the employment contract is specific to an individual.
There may even be a provision for the employee to remain on garden leave during a notice period. This is particularly useful if it is considered by the company that the leaving employee might become a disruptive influence if permitted to remain on the premises, which may happen if the employee is leaving as a result of disciplinary action.