Ask the HR Department: What do employers need to include in an employment contract?

By HR and health & safety consultancy Peninsula Canada

A well-written and comprehensive employment contract is an essential component to protecting both the interests of the business and staff. Employment contracts help to provide clarity on everyone’s rights and responsibilities.

What should employers include in an employment contract? Aside from the minimum entitlements required by the provincial employment standards legislation, any additional clauses and policies that can be included will depend on the industry and type of employment being offered.

Some basic terms of employment you may want to consider include:

  • Hours of work
  • Job responsibilities
  • Conditions of offer
  • Layoff clause
  • Termination clauses and policy

Are written employment contracts better than oral contracts? Although the terms of employment can be provided orally, it’s best to outline important information in a written contract. Written contracts are strongly recommended as they help to:

  • Outline responsibilities. Having this in writing helps to clarify the role of the employee. It also helps to set expectations, making them aware of all their responsibilities in the workplace.
  • Resolve disagreements. A written contract that clearly defines the terms of employment and rules of the workplace can serve as a reference guide in case of any disagreements. Employment contracts often include dispute resolution procedures that help avoid long legal battles.
  • Avoid lawsuits. A well-written contract significantly reduces the risk of legal claims for the employer and protects the rights of the employee by ensuring they receive the minimum entitlements stated in the provincial employment standards.

What should employers keep in mind when drafting employment contracts? It’s important for employers, especially those operating a nationwide business, to remember that employment laws vary across provinces. It’s the employer’s responsibility to stay up to date on the terms and provisions of any provinces they operate in.

Peninsula is an HR and Health and Safety consulting firm serving over 80,000 small businesses worldwide, including dealers in home improvement. Clients are supported with ongoing updates to their workplace documentation and policies as legislation changes. Additionally, clients benefit from 24/7 employer HR advice and are protected by legal insurance.