5 Reasons Why You Should Issue Employment Contracts before an Employee Begins Work

An employment contract is a linking document between an employer and their employee. Most importantly, it outlines the basis of their work engagement and provides guidelines on how to maintain a healthy working relationship.

Some employers, however, do not treat employment contracts with the importance they deserve. Some issue work agreements after the probation period is over, while others operate by word of mouth. This is very risky for the employer and their business as well.

It could expose you to risks and interfere with your normal business operations. Regardless of whether they are part-time, casual or full-time employees, a work contract should be prioritized.

In this article, I outline 5 reasons why you should issue an employment contract before the employee begins working

1. It keeps you compliant with labour laws

Every employer is required by the law to have a work agreement document that describes their terms of engagement with their staff. Thus, issuing it as the new worker begins their tenure keeps you compliant with the labour laws and reduces the risks of any legal actions that may be taken.

2. It informs them of their responsibilities

The terms of employment document will outline the duties and responsibilities of the worker. Contrary to defining responsibilities by word of mouth, a contract will provide a written guideline for the staff to stick to, thus guiding them towards their assignment for the role.

3. It can be used as a tool for evaluation

Thirdly, an employment agreement can be used to evaluate the performance of the employee based on the guideline issued at the start of their term. This applies to all types of agreements but mostly short-term engagements where as an employer you need to evaluate the quality of the work done.

4. It reduces the risk of unexpected turnover

A work contract will legally bind an employee and provides that they should issue a notice in case they wish to leave employment. Therefore, issuing them with this document ensures that an employee cannot just leave but has to tender in a notice which helps you either prepare by replacing them or delegating their duties.

5. It ensures the protection of intellectual property

The non-disclosure statement in a work agreement protects your intellectual property rights and ensures that important details about clients, your business, and your innovations are not disclosed to unauthorized people. Thus, it is important to make this clear in the contract and ensure that the employee is aware of it as they start work.

Finally, it is important that as you issue the employment agreement, make sure to go through it with your recruit and explain areas they do not understand. Also, make sure to highlight the key issues that touch on your business and may affect its success. You can hire an HR consultant to help in drafting a relevant document for you to ensure every key detail is captured.