Five Tips For Employment Contracts

Written By Julia Meyers

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An employment contract is an essential part of the relationship between employer and employee. If the employment agreement is drafted properly, it will protect both the employer and employee. These contracts are designed to create job security for the employee and labor certainty for the employer.

​The understanding of position and duties comes from an employment contract. Further, an employment contract is a great way to maintain trade secret or confidentiality for an employer. An employment contract gives a good foundation for a healthy relationship between employer and employee. Below are six tips for employers when drafting an employment contract and for employees when signing an employee contract.  

1. Assignment of IP 
   If an employee is developing something that is eligible to obtain a patent, trademark or copyright, the employer would want to make sure they are entitled to this. These could include an array of inventions such as patentable devices or software codes. This is a crucial part of an employment contract. If left out this can lead to issues with the employer and employee about who has the right to work made during the time of employment.   
   
2. Confidentiality
   If there is not a separate document relating to confidentiality, typically referred to as a Non-Disclosure Agreements (NDA), an employer would want to ensure that there is a clause in the employment agreement relating to confidentiality of information. The confidentially clause should cover any valuable information that you would like to keep secret, which could include anything from product ideas to customer lists.  
   
3. Termination Agreement 
   It is especially important for independent contractors to ensure there is a clause in the contract that allows for easy termination of one party or another. In Ohio, it is permissible to contract for employment at-will, meaning either the employee or employer can terminate the contract for any reason or no reason at all.  
   
4. Personnel Policy
   A personnel policy is an important aspect of an employment contract because employers want to ensure that employees are receiving the same benefits as other employees. Employees also want to ensure that they are not receiving less benefits than another. A personnel policy would refer to an employee manual and ensure there are no discrepancies in benefits received.  
   
5. Standard Agreements
   Companies should make sure they develop a standard agreement form that is drafted by an attorney and that they understand and can use repeatedly. This will help both the employer and employee for understanding the terms and conditions of an employment contract.  
   

  
This is a non-exhaustive list of important pieces to include in an employment agreement, but in our experience, these are the most common things that get overlooked in employment contracts. This is not formal legal advice, and we advise you to seek legal advice if you have more questions. A good resource for learning more and getting any questions you may have answered is The University of Akron SEED Clinic (https://www.uakron.edu/law/curriculum/clinical-programs/seed-clinic).