Five Important Reasons For Employment Contracts
- Certainty – At the conclusion of employment (all employment concludes at some time) the precise consequences including severance pay is spelled out. There should be no need to involve lawyers in most cases.
- Protection – The contract will eliminate any doubt about what information is confidential and will be protected. The contract can also protect against unfair competition after conclusion of employment.
- Flexibility – A contract can establish the right of the Employer to transfer or change the duties of an employee.
- Accountability – A contract can establish performance standards and important duties for the employee.
- Cost – The cost of an employment contract is negligible compared to the cost of defending a wrongful dismissal action, paying court established severance pay, or using the courts to protect confidential information or restrain unfair competition.