Employment Contracts and Benefits

During the interview process of a potential job, applicants should be sure they fully understand each task that may be assigned to them if hired. It’s best to have job duties spelled out in a written job description.

Assuming you plan to stay with a new employer for an indefinite period of time, try to obtain at least a one-year contract. If you’re not offered any true job stability, you probably will be classified as an at-will employee who usually can be fired without notice and quit without notice. If possible, ask your employer to include a provision for two weeks of pay and a severance package should you be terminated without notice so you will have time to locate a new job before current pay and benefits end. During the application process, keep in mind that you should not raise the issue of compensation or benefits until a job offer has been made.
If your contract requires you to sign a “covenant not to compete” for a reasonable period of time after you leave the employer, ask if you must sign it as a condition of employment. If so, try to either get the time period shortened or use this concession as a bargaining chip to obtain another employee benefit already declined or not offered. The law of your state may limit the length of time an employer can enforce a covenant not to compete against you.

Apart from these precautionary contract terms, be sure the following information is clearly set forth in either a written employment contract, an employee handbook or a written job description.

  • The starting salary and minimum number of weekly work hours.
  • The job title and name of the new hire’s immediate supervisor.
  • The types of health care and disability insurance available to you and your dependents.
  • The sick leave and vacation time policies. Many employers simply provide “personal leave” so employees don’t have to state the reason for absence. Your contract should clearly state if you will be entitled to collect any unused portion of this earned time if you are fired. You should also find out if your state allows workers to carry over any of these earned benefits from one year to the next.
  • Information on how the employer handles time off under the Family Medical Leave Act. This should be addressed carefully because you do not want the employer to think you’re already planning to take a lengthy period of time off the job. The topic can be broached by simply asking how many employees are on the payroll (if you are not working for a covered federal employer). This will help you determine whether the employer is bound by the FMLA. If your employer is not, research if your state offers any such coverage to employees. You may need to consult with an attorney to be sure you are accurately interpreting your state’s labor laws.
  • The employer’s regular pay days and what types of deductions will regularly be taken out of each paycheck. See if your employer will give you a monthly or annual parking or transportation allowance, and ask if this can be deducted before taxes.
  • Whether you are entitled to overtime pay and how that pay will be calculated.
  • When you will become eligible for a bonus and how the employer computes the amount. Ask how your job title, work performance and other elements figure into the equation.
  • How soon you can begin participating in a 401k, thrift, stock bonus or employee stock ownership plan (ESOP). Ask when and how the employer’s contributions vest and how such funds are handled upon leaving the employer. Also find out whether any penalty fees apply or if the invested funds are lost if you are fired or abruptly leave your job.
  • What types of work expenses will be reimbursed and when.
  • If you are working for an employer who regularly transfers employees to other offices, be sure your contract provides for the advancement of all necessary relocation expenses. Likewise, if you’re applying for a position in another city, ask if the employer will advance such relocation fees to you. It’s best to get such agreements in writing, making it clear that these fees are paid by the employer.
  • Whether you must give up all rights to any works or inventions you create for your employer. See if you can obtain at least an agreement that you’ll be given a detailed letter (upon leaving the employer) that will clearly indicate your personal contributions to the company.

Other topics are appropriate to discuss during an employee orientation or during a one-on-one talk with human resources on your first day of work, if not before.

  • How workplace disputes should be handled.
  • The types of office equipment that will be assigned to you and the rules governing usage.
  • The employer’s workplace-evacuation plans and other safety-related matters.
  • The approved dress code.
  • If you’re required to clock in or out when you arrive or check in with a superior upon arriving and departing each day.

Before starting a new job, get a fully executed copy of your employment contract. It could prove helpful should any future legal disputes develop.

Employment Contracts and Compensation Agreements

To be sure every important contract issue has been addressed, employers and employees should consider reviewing the federal government’s reference guide to the Fair Labor Standards Act. The act mainly addresses basic wage and overtime pay issues.
It’s equally important to review your state’s labor code governing all such contracts, whether you’re going to be working for a private or government employer. You may need an attorney’s assistance when interpreting this information.

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