As an employer, maintaining a productive and collaborative work environment is essential to your business’s success. A pillar of this success is the establishment of clear and enforceable employment contracts. In this blog post, we will discuss tips for drafting employment contracts in order to foster a productive workplace and mitigate risk.
- Comprehensive Employment Contracts: A well-drafted employment contract should cover the terms and conditions of employment, job responsibilities and expectations, compensation and benefits, termination, and dispute resolution procedures. The rights and obligations of both the employer and employee should be clear and enforceable. This reduces the likelihood of disputes down the road.
- Non-compete, Non-disclosure and Confidentiality Agreements: These agreements can provide significant protection for your confidential information and trade secrets. Non-compete agreements should be drafted in terms of scope, duration, and geographic area. Because of employment regulations, however, non-compete and non-disclosure agreements should not be overbroad. Otherwise, they might not hold up in court. Non-disclosure and confidentiality agreements are excellent tools to protect your intellectual property. The type of information that is confidential or proprietary should be clearly defined.
- Intellectual Property Ownership: Intellectual property may be developed during the course of an employee’s employment. Specifying in an employment contract that the employer owns any intellectual property that is developed during the course of employment is one method of protecting your business’s intellectual property.
- Labor and Employment Regulations: Staying up to date on local, state, and federal labor and employment regulations is essential to ensuring your employment contracts are effective and enforceable. For example, although non-compete agreements are currently legal in Virginia, the Federal Trade Commission (FTC) is currently considering a nationwide ban on all non-compete agreements, which we discuss in a separate blog.
- Termination Clauses: Termination disputes are common contract-related claims that employers face from lawsuits filed by employees. To mitigate the risks associated with a termination dispute, employers should clearly outline the conditions under which termination may occur, notice periods, severance packages, and post-employment restrictions. The return of any company property should also be covered.
- Dispute Resolution: Your employment contract should cover the governing law and jurisdiction for any disputes that might arise. This could include, for example, arbitration, mediation, or the jurisdiction in which you are located.
- Regular Contract Review: Employment contracts should be considered as living documents that evolve with the needs and changes of your business and the legal world. As mentioned above, the regulatory landscape for employers is constantly evolving, and it is important to update your employment contracts to comply with any applicable laws.
Conclusion
Clear and enforceable employment contracts are an essential component of any successful business. Although this list is not exhaustive, these are seven helpful ways to mitigate risk, protect your business, and foster a productive work environment. Our attorneys regularly assist employers through all stages of the contract lifecycle, from drafting initial employment contracts to litigating employment contract disputes when they arise.
For a consultation with one of our Business Representation attorneys, call 703-535-7809 or email info@moorechristoff.com.
*This blog post is for informational purposes only and is not intended as legal advice. Past results do not guarantee future outcomes. If you have questions regarding any employment law issues, you should consult with an attorn
