What is an Employment Contract?
An employment contract is an agreement with your employer that describes some of your rights and obligations as an employee. It can be written or verbal. In fact, sometimes a company’s employee handbook or other personnel policies can be enforceable as an employment contract.
An employment contract typically discusses the salary and benefits you will receive and outlines the basis for any commissions or bonuses you might be eligible to earn. Sometimes they also guarantee your job for a period of time, or limit the reasons why you can be fired.
Many employment contracts contain non-compete agreements that limit your right to work for a competitor after you leave your job. Other employment contracts include severance agreements that, if certain circumstances occur or conditions are met, would require your employer to pay you money after your employment ends. For example, it is fairly common for employment contracts to guarantee severance for employees whose jobs are eliminated in a mass layoff or a reduction in force.
Unwritten Employment Contracts Can Be Enforceable
While it is always a good idea to put your employment agreement in writing, an employment contract does not necessarily have to be written for it to be enforceable. Rather, oral agreements are enforceable in both New Jersey and New York. So, for example, if your employer promises you a certain salary and benefits, once you work to earn that compensation your company is required to pay you based on its offer.
If your company refuses to pay you based on the salary you agreed upon, it would be a breach of your contract. Unfortunately, that happens all too often. Luckily, the employment lawyers at The Nirenberg Law Firm are trained to help you enforce your contractual rights.
Guaranteed “Term of Years” Employment Contracts
If you have a guaranteed term employment contract, then it could be a breach of contract if your employer fires you before the term is over. For example, if you have a one year employment agreement, but you are fired for no good reason after only 3 months, depending on the circumstances you may be entitled to be paid for the 9 months remaining on your contract. You also might have a legal claim if you are fired in violation of a provision in your employment contract that limits the reasons why you can be fired, such as if it says you can only be fired for either “just cause” or “good cause.”
Restrictive Covenants in Employment Contracts
Many employment contracts have special provisions like non-compete, non-solicitation, non-disclosure, trade secret, and arbitration clauses. Not only are these provisions typically complicated and confusing, but they also can become critical once you decide to move on to another job. Whenever possible it is important to make sure you understand and agree with these restrictions before you accept a job offer. In some situations, you might be able to negotiate better terms, or even remove problematic provisions. In other instances, it might not be worth accepting a job offer if it is going to make it extremely difficult, if not impossible, to find another job in your field or industry in the future.
Even if you have already signed an employment agreement with a restrictive covenant or another problematic term, you should consider contacting an employment lawyer to make sure you understand your legal obligations.
Understanding Your Employment Contract
Our employment law attorneys are experienced at reviewing, interpreting and explaining employment contracts in terms that make sense to you. It is a good idea to have an employment lawyer review your new employment contract before you accept a new job, or help you negotiate your employment contract. It also can be important to discuss your current employment agreement if you are considering accepting a new job. Similarly, we can help you understand your rights under your current employment contract if you are having a dispute with your employer, or if you simply want to understand your rights.
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