I am sure that you already know about an employment contract. Either side of the business i.e. whether you are an employer or an employee, this term forms the first step of building a team.
I understand it is a scary thing for a startup when it comes to drafting contracts or getting contracts drafted. As per my experience of registering startup private limited companies, the first few things that come in mind are:
- Whether we have included all the possible clauses in the contract?
- Is our contract binding enough?
- Is it complete?
- Can it be enforced at the time of need?
Ok, we cannot discuss all the problems faced while drafting an employment contract. But we surely can discuss the most essential clauses of an employment contract. I am not including the clauses of name of employee, company name, address, date of contracts for obvious reasons. Don’t ask me why 😉
Let me tell you first of all that I have compiled one for you. You can download a sample format of a good employment agreement here. It is free of cost. You can also Real time edit the contract to customize the name, position, salaries etc. in our live editor application. So as per our discussion here are the top 10 Essentials of a great employment contract for startups:
Many a times I have seen employment contracts without the mention of the position at which the employee is hired. Sounds really strange to me! Any Professional company will always have the system of reporting to superiors and taking reports from sub-ordinates. Position signifies the essence of being a part of a team in the organization.
This clause is mainly for the job security of an employee working in your startup. An employment contract must mention the employment period for an employee. It should mention the period for probation as well. This needs to be in writing so that an employee knows when he / she will become a permanent member of the startup.
Effective performance of Duties clause
Yes, one needs to know his/her job profile for sure. An employee needs to be sure about his duties and responsibilities; this in turn helps in effective performance as each employee knows what is expected out of his association with the startup and is accountable for the work he/she performs.