What are the important features of Employment contract?

Posted by legallegends on March 16th, 2017

Every employer should provide employment contract to their employees within sixty months from the joining time.  This is known as statement of terms that includes almost all the conditions, which an employee should know from the employer.  Let us find out what these important terms of statements are.  However, one should remember that these statements contains terms that are bare minimum and it varies extensively from company to company or from an employer to employer.  The contract usually contains significant features as mentioned here.  Every company has an employee manual book where all the stipulated rules and regulations are mentioned.  It may vary as per the assigned designation in the Employment Contract . Therefore apart from the details mentioned in the manual, one should pay attention to the conditions mentioned in employment contract. 

The contract should include complete address contact details of both parties that are employer and employee. 

Employment starting date is of high importance, as the employment period with the previous employer is not considered with this employer, and the joining date is considered as first of employment for any employee in the concerned company.

It should include job description and rights and responsibilities with a mention of designation and the key role play of the employed person.  It is often mentioned in the advertisement placed by the employer for the designated role. 

Before joining, the location should also be mentioned in the contract.  This is important since some of the jobs like sales representative, and companies having branches in different cities may require their employees to look after some of the responsibilities in as and when required.  Such conditions should me stipulated clearly in the contract and consent letter with respect to this should be obtained by the employer.

Number of working hours is next priority.  In some companies’ employer don’t exist on strict working hours, but they expect targets within the stipulated period, and the employees are expected to maintain seamless work flow.  In case of stringent working hours it should not exceed 48 hours per week as per the labor act and regulations.  Therefore, it is important to follow working hours. 

As soon as an employee gets an appointment letter it does not show whether he is a permanent employee or temporary or on probationary period.  Therefore it is necessary to know the probationary period as well.  Probationary period varies from three months, to one year.  The period varies as per the work demand. 

Assessment period is another significant factor.  It should be clearly mentioned in the joining letter as how the employee will be assessed for his/her performance level and promotion or increment details should clearly outlined so that they can be aware of their assessment methods. 

The most important part of the agreement or contract part is breakup of salary one is going to get for their service.  The CTC that means cost to company should be clearly mentioned before tax and after tax along with other deductions.

While these are some of the important features, there are other things as well that required to be included in the contract. 

About the Author:

The writer is an expert in the field of Employment Contract on the basis of important terms of statements. He share ideas related to Memorandum Of Incorporation and Shareholders Agreement