How to Write a Simple Employment Contract

An employment relationship begins with two interests meeting. One party needs work to be performed while the other seeks an opportunity to contribute and earn. Reaching that point may require considerable searching, applications, and interviews.

Once the parties have found sufficient common ground to cooperate, they must give their understanding a durable form. A simple employment contract is one of the principal ways of achieving this.

What is an Employment Contract?

An employment contract (or contract of employment) is a formal agreement between an employer and an employee outlining information about both parties and the fundamental terms and conditions of their professional relationship. 

Ways an Employment Contract May Be Agreed

An employment contract does not always have to take the form of a traditional paper document. Depending on the circumstances and applicable employment laws, an employer may offer employment terms and conditions in several ways. The most common forms include paper, oral, electronic, and implied employment contracts.

Paper Contract

A paper employment contract sets out the agreed terms and conditions of employment in a physical document. Each party should retain a copy for their records.

However, writing a contract on paper does not by itself determine whether it is legally valid. The agreement must still satisfy any applicable legal requirements, and some jurisdictions may require particular employment terms and conditions to be provided in writing or impose specific rules concerning contractual terms/conditions and signatures.

Oral Contract

An oral employment contract is created when an employer and employee verbally agree to the essential terms and conditions of employment. For example, an employer may offer someone a job, state their salary and working hours verbally, and the employee may also accept those terms and conditions verbally.

Verbal agreement can still create contractual obligations in some jurisdictions. However, proving exactly what was orally agreed (in the absence of a written or some other evidence) can be difficult if a disagreement arises. For this reason, putting important employment terms and conditions in writing is generally a safer approach.

Electronic Contract

An electronic employment contract is an employment agreement created, delivered, accepted, or signed electronically. It could be shared as a digital document and accepted through an electronic signature platform or another legally recognised method.

Electronic contracts are particularly useful for remote hiring because the employer and employee do not need to be in the same location to review and sign the agreement. The parties should ensure that the electronic signing process complies with applicable laws and that both sides retain a copy of the completed contract.

Implied Contract

An implied employment contract arises from the actions, conduct, policies, communications, or circumstances surrounding the employment relationship rather than from an express written or oral agreement.

For example, an employer's established workplace conditions or repeated promises about certain employment terms may contribute to an implied agreement in some legal systems.

Because implied terms and conditions can be difficult to identify and interpret, employers should avoid relying on assumptions. Clearly documenting the terms and conditions in a written employment contract can reduce uncertainty about what both parties have agreed to.

Types of Employment Contracts

1. Full-Time Employment Contract

A full-time employment contract is for a worker who has a regular, substantial work schedule and an ongoing employment relationship with an employer.

Its defining feature is the employee's commitment to a standard full-time workload rather than a limited number of hours or a specific short-term assignment.

The contract normally establishes the employee's regular duties, schedule, pay, and other employment terms and conditions.

2. Part-Time Employment Contract

A part-time contract is designed for an employee who works fewer hours than a comparable full-time worker.

The employee still has an employment relationship with the organisation, but their working schedule is reduced.

The contract should make the expected hours and schedule clear, particularly where the employee's hours may vary from week to week.

3. Zero-Hour Employment Contract

A zero-hour arrangement does not guarantee the employee a set number of working hours.

Instead, the employer offers work when it is available, with the employee working when assignments are provided and accepted. Its defining feature is the absence of guaranteed hours.

Because laws governing these arrangements differ between countries, the contract should comply with the applicable local rules.

4. Casual Employment Contract

A casual contract is generally suited to work that is irregular, short-term, seasonal, or dependent on the employer's changing needs.

Unlike a regular employee with a predictable schedule, a casual worker may work only when required. The lack of a consistent working pattern is one of its key distinguishing features.

5. Freelance Contract

A freelance contract is based primarily on services or deliverables, rather than placing the worker into an ongoing employee role.

A freelancer may be hired to write an article, design a website, develop software, or complete another defined assignment. The agreement typically focuses on the work to be delivered, deadlines, fees, and ownership of the resulting work.

Unlike the other arrangements on this list, a genuine freelancer is generally an independent contractor rather than an employee.

6. Union Employment Contract

A union employment contract applies to workers whose employment terms and conditions are negotiated or governed through a labor union.

Rather than an employer and individual employee determining every term independently, the worker's conditions may be established through a collective bargaining agreement.

Pay scales, working conditions, grievance procedures, leave, and other employment matters may therefore apply across a group of represented employees.

7. Executive Employment Contract

An executive employment contract is intended for senior-level employees whose responsibilities and compensation are typically more extensive than those of ordinary employees.

In addition to defining the executive's role, it may address performance incentives, bonuses, company benefits, confidentiality, severance, and other terms and conditions associated with senior management.

Its distinguishing feature is the level of responsibility and the more specialised terms and conditions often attached to the position.

8. Fixed-Term Employment Contract

A fixed-term contract has a defined endpoint. The employee may be hired for six months, one year, or another agreed period, or until a particular project or assignment is completed.

Unlike an indefinite employment arrangement, the parties know from the outset that the employment is intended to last for a specified period or until a defined event occurs.

9. At-Will Employment Agreement

An at-will employment arrangement, associated particularly with the United States, generally allows either the employer or employee to end the employment relationship at any time, subject to applicable legal restrictions.

Its distinguishing feature is the absence of a guaranteed employment duration. Because employment laws vary between jurisdictions, this concept should not be presented as applicable to employment relationships everywhere.

10. Non-Compete and Confidentiality Agreement

This category is different from the others because it focuses on protecting the employer's business interests rather than defining the employee's working schedule or duration.

Confidentiality provisions restrict the disclosure or misuse of protected business information, while non-compete provisions may restrict certain competitive activities after or during employment.

These restrictions can be subject to significant legal limitations, particularly non-compete clauses, so they should be drafted with the applicable jurisdiction in mind.

How to Write a Simple Employment Contract

A contract of employment can either be written manually from scratch or with an already made customizable employment contract template. The latter option is highly recommended because it has more advantages when compared to the former.

Earlier, it was noted that an employment contract includes the employer's terms and conditions for their employee. These terms and conditions may vary according to the employer but typically include:

• Parties to the agreement.
• Legal status and governing law.
• Job role and responsibilities.
• Commencement and probation.
• Remuneration and benefits.
• Working hours and location.
• Leave entitlements.
• Termination and notice period.
• Confidentiality and nondisclosure.
• Special clauses (e.g., leave entitlements, confidentiality,  intellectual property rights, dispute resolution mechanisms and termination procedures).
• General provisions.
• Signatures. 

To quickly write an employment contract for any type of employee/worker, here are some employment contract templates you can customize.

Best Practices for Drafting a Simple Employment Contract

• Use clear and specific language: Write in simple language so both parties can easily understand their rights, responsibilities, and obligations.
• Include all essential employment terms and conditions: Cover the key details of the employment relationship, including duties, pay, working hours, leave, benefits, termination, and other relevant conditions.
• Adapt the contract to the actual employment relationship: Tailor the agreement to the employee's role, working arrangement, responsibilities, and specific circumstances.
• Use an employment contract template as a starting point: A reliable employment contract template can save time and provide a useful structure, but it should be customised to suit the particular employment arrangement.
• Check applicable employment laws: Ensure every provision complies with the employment laws and mandatory requirements of the relevant jurisdiction.
• Avoid unsupported assumptions about employee status: Make sure the worker's classification reflects the actual nature of the working relationship rather than simply the label used in the contract template.
• Be careful with restrictive clauses: Draft confidentiality, intellectual property, non-solicitation, and non-compete provisions carefully because their enforceability may depend on local law.
• State the governing law and relevant procedures clearly: Identify the applicable jurisdiction and explain how disputes or other employment issues will be handled where necessary.
• Review the contract before signing: Give both parties enough time to check the agreement, clarify uncertainties, and correct errors before acceptance.
• Keep signed copies securely: Ensure both parties retain an accessible copy of the final signed agreement, whether it was executed on paper or electronically.
• Seek professional legal advice where necessary: If the employment arrangement involves things like complex terms, significant legal obligations, restrictive clauses, unusual working conditions, or questions about compliance with local employment laws, consider having the contract reviewed by a qualified legal professional before signing.

Conclusion

A successful hiring decision deserves an equally considered agreement. A simple employment contract brings the principal terms and conditions of the relationship together, allowing both parties to proceed with a clearer understanding of what has been agreed.