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HR Support on Employment Contracts
Editor's Note: Employers beware: employment contracts can be both written and implied.
Overview: Employment contracts set out the duties of the employee and employer, and provide the employer with the opportunity to clarify the relationship. The specific terms required in an employment agreement vary by state and by type of employment or profession. Although the terms of employment contracts may differ, every written contract of employment should be signed by both the employer and the employee.
Some states recognize implied employment contracts when an employer makes statements or takes certain actions that are inconsistent with an at-will employment relationship - even if they are unintentional. If an implied employment contract is found, an employer may be bound by its terms. Therefore, since employment contract law is state driven, employers should check the laws in which they do business in order to avoid creating an implied employment contract.
Trends: Employers continue to be exposed to claims by at-will employees, who claim that their termination of employment was in violation of an implied employment contract based on language contained in an offer letter or employee handbook, or by verbal statements of job security by the employer. Therefore, if an at-will employment relationship is intended, employers must make clear to the employee that he or she is an at-will employee and disclaim any contractual relationship.
Melissa A. Silver, J.D., Legal Editor
Latest items in Employment Contracts
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Texas Adopts Uniform Trade Secrets Act
Effective September 1, 2013, Texas employers will have a more consistent and predictable legal framework for protecting their trade secrets. Texas has adopted the Uniform Trade Secrets Act (UTSA).
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Terms of Employment: Texas
In-depth review of the spectrum of Texas employment law requirements HR must follow with respect to terms of employment.
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New Content Added on Restrictive Covenants
XpertHR had added certifications that employers should provide to new hires to ensure that they are not subject to any restrictions on competition or subject to an agreement that would prevent them from using the confidential information of a former employer. The Terms of Employment section of the Employment Law Manual also now includes a discussion on obtaining these certifications at or prior to hiring.
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Terms of Employment
The terms and conditions that govern the employment relationship are typically governed by federal and state employment laws, including antidiscrimination laws. This section helps HR professionals avoid discriminating on the basis of race, color, religion, sex, pregnancy, national origin, age, disability, genetic information and veteran status throughout the employment relationship.
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Certification That Employee Will Not Use Confidential Information of a Former Employer
An employer may use this certification with new employees in order to make clear to them that they cannot use confidential or proprietary information they acquired during their former employment. If an employer does not use this certification and an employee improperly uses the confidential information of the former employer and the new employer knew or should have known that the employee was using such information for the new employer's benefit; both the employee and the new employer can be subject to a legal action by the former employer/competitor.
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Certification That Employee Is Not Bound by a Noncompete or Nonsolicitation Agreement
Employers should require prospective employees to sign this certification prior to hiring to ensure that he or she is not subject to a restrictive covenant with his or her current or former employer that would restrict his or her ability to perform the job. Employers should require prospective hires to sign this certification because if the employer does not and it hires an employee who is subject to a restrictive covenant, the former employer may not only file an action against the employee, but against the new employer.
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Tennessee Recruiting and Hiring Sections Updated to Include Interference With Employment
The Tennessee Employment At-Will and Terms of Employment sections have been updated to reflect a discussion of the intentional interference with employment cause of action available to employees, illustrated in a recent case decided by the Tennessee Court of Appeals.
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New York Recruiting and Hiring Content Enhanced
A New Hire Paperwork section has been added to the New York Recruiting and Hiring content detailing notification and paperwork requirements for new hires.
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Terms of Employment: New York
In-depth review of the spectrum of New York employment law requirements HR must follow with respect to the terms of employment.
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Terms of Employment: Tennessee
In-depth review of the spectrum of Tennessee employment law requirements HR must follow with respect to terms of employment.
About this topic
Guidance for HR on the use of employment contracts. Support on creating and enforcing legally binding contracts that cover all the vital areas.