Analysis of Employment Contract - Paper Example

Published: 2021-07-27
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George Washington University
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An employment contract should provide the names of the parties involved when sealing an agreement. The two sides are the employer and the employee. As part of the contract, the details regarding the employers organization as well as the full names and address of an employee should be provided (Filsinger, 2015). From the sample provided, the employment contract has complied with this requirement. There are the slots of Name (worker) and his or her address and the company. All of these slots play a significant role when it comes to capturing crucial details of the parties taking part in this employment contract.

An employment contract should adequately define the position. This provides the potential employee with a vivid understanding of the job specifications and requirements. According to the description on the sample of employee contract provided, the company is offering the prospective staff the position of Senior Solutions Consultant. He/she should report directly to the companys Vice President of the Business Development department. From this description, it is apparent that the agreement has defined the position of an employer by providing the name of the position and necessary duties it entails.

It is vital for an agreement to explicitly spell out the place and hours of employment as part of defining the position of an employer. For instance, in this sample, key timelines have been stated. It has been outlined that as of Senior Solutions Consultant, one will be paid semi-monthly as well as being entitled to an annual vacation of 3 weeks per year. This employment contract has also applied concise and precise language, thus leaving no room for ambiguity when it comes to the expectations of an employer regarding the position offered by the company.

The start date is another legal element that needs to be stated in the employment contract. This component is vital since it includes a brief statement which indicates that employment with the previous employer does not matter or count to various rights and privileges enjoyed by the employee in their current job. This implies that the new staff will begin again from scratch with his or her new employer (Filsinger, 2015). From the contract sample provided, it is stated that the contract between the employer (company) and the employee will be effective as from March 16th, 2012. This indicates that the employment laws contained in this agreement will start applying immediately on the stated date.

Salary is also another clause which characterizes a legally sound employment contract. The details regarding the gross pay, before computation of tax, national insurance and other relevant deductions for a prospective employee needs to be outlined in the agreement. This section of the employment contract also specifies the when the payment will be made (Filsinger, 2015).

According to the sample of a given employee contract, it has been stated that the company will pay the employee the base salary of $85,000 which is remitted semi-monthly. The contract also outlines that there will provide additional incentive compensation of $50000 based on a personal sales target of $3,000,000 in revenue received from partners. Additionally, the employer is entitled to an annual Management Business Objective (MBO) bonus of up to $10,000 based on his or her contribution to non-sales related activities including services delivery, marketing, and/or internal development. This component of employment law ensures that the parties involved agree on the compensation scheme or payment packages to avoid conflicts that are likely to occur in future.

Benefits associated with the job is another clause that should be included in the employment contract. The agreement should state the benefits package for the newly employed staff. This section can consist of various privileges such as health, insurance cover, rates and different forms of membership programs. The benefits can also include holidays and vacations for an employer (Filsinger, 2015). The element of benefits has been captured in the sample of employment contract provided. In this document, it has been highlighted that an employer will be enrolled in the companys benefit plan after 90 days of his or her start date. Some of the stated benefits include: 100% company paid a premium for Dental, Extended Benefits, Life and AD&D and 100% employee paid a dividend for LTD. Also, the employee is entitled to an annual vacation of 3 weeks per year. The worker is also eligible to participate in the Companys Employee Stock Option Plan. Such Stock Options are granted under the terms and conditions of the institution Stock Option Plan.

The legally sound employment contract should include a section where both parties (the employer and the employee) are allowed to seal the agreement. This is where the company and the worker provide their signatures signifying that they have read and understood the legal demands of the contract. The signing of the employment contract will also imply that the parties are willing to abide by the terms and conditions of the agreement thus making it a legal binding (Filsinger, 2015). The sample of the employment contract provided contains the clause that enables the company, through the Vice President, Business Development to acknowledge the legality of this contract. There is a slot where the Vice President provides his name and the signature. On another hand, the employee also accepts that he or she has read and agreed to the terms outlined in the contract. The employer provides his or her signature as well as the date of signing the contract. It is through such elements of the law that have made the employment contract of the sample provided to be a legally sound.

Suggestions for the Improvement to be made on the Employment Contract

The sample of employment contract employment contract 2 has included significant components that make it legally sound. However, some elements were omitted that can cause ambiguity and confusion. It follows that there is the need of making some amendments that will improve the current state of this employment contract (Filsinger, 2015). Dispute resolution is one of the components that need to be included in the sample of this employment contract. Apparently, this sample has not covered this clause. Additional of this element will enhance the efficiency of the employment contract since it will specify some of the approaches (such as mediation or arbitration) that can be utilized when resolving a given conflict within the organization. The disputes can be amongst the employees or from the staff and the employer.

The termination clause is another component that ought to be introduced in this sample of the employment contract. It is essential that the agreement gives relevant details on what will happen in the event where there is the breach of contract by any party. Filsinger (2015) points out that it is paramount for a given employee contract to explore possible grounds which can lead to the termination of the contract. For instance, the contract should specify the action that will be taken once the employee is dismissed without a cause. The introduced section should provide a precise definition of both scenarios, ultimately giving severance terms that can fit in each case.

Confidentiality, Non-Competition and Non-Solicitation are some of the clauses that are missing from this sample of employment contract, thus highlighting the need of incorporating them to avoid aspects of confusion and ambiguity. Nondisclosure agreements (confidentiality) are part of the amendments that should be made to improve the selected employment contract. This component of law will enable the company protects its top secrets from being divulged to the public domain, which can increase the firms vulnerability to its competitors. Through this contract, employees should agree that the information is an exclusive property of the company thus should be held by mutual trust. Under this clause, an employee will not be allowed to disclose or use the companys confidential information during or after his or her employment.

Other clauses that need to be included in this employment contract sample include: modification of agreement, governing law, independent legal advice, return of property and expenses. These legal components will play a critical role in improving the sample of the employment contract provided.

Employment contract remains to be a crucial tool that provides a framework for the working relationship between an employer and the staff. It is essential for a contract to include appropriate components that ensure it is legally sound. It is recommendable for an organization to do necessary amendments as a way of improving its employment contract.


Filsinger, K. J. (2015). Employment Law for Business and Human Resources Professionals. Emond Montgomery Publications.



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