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latest news in employment law

Employment Agreements Are Compulsory

Published 01 Jun 2010

Employers are required to provide every new employee with a written employment agreement. Failure to comply with the legal requirements relating to employment agreements can result in the employer being penalized (fined). (In theory fines could be up to $10,000)

A well drafted employment agreement (and job description) sets out the employer's expectations for conduct and performance, and provides a measure of protection for the employer. It is not just a legal requirement, it is in the employer's best interest to have an employment agreement in place.

Employment rights begin when the offer of employment is accepted. This could be a verbal offer, made over the telephone, which is immediately accepted. At that point the candidate becomes an employee but you haven't agreed any detail which may protect you.

You have just made it very difficult to negotiate an employment agreement - because the employee is already an employee, and doesn't have to agree to or sign your employment agreement.

Ideally, you should only offer employment, in writing, "on the terms of the proposed attached employment agreement." This means you need to draft the proposed employment agreement so that the candidate can see in detail, what you are offering. The letter of offer should advise the employee that they are welcome to take advice about the proposed agreement, and that you will discuss the proposed terms of the offer if they wish to. But if they want to accept the offer - they are accepting these terms. You may discuss changes, but you are not obliged to modify the offer. Any modified offer would be in writing. The candidate may accept the offer, by signing the proposed employment agreement and returning one copy to the employer. You may withdraw the offer at any time, and it will be automatically withdrawn if you have not heard from the candidate by [date and time].

You may withdraw an offer of employment at any time before it is accepted.

If you want to include a 90 day trial period, you can refer to this in your letter of offer, so that you can prove your intentions from the outset and this helps to ensure that the trial period is effective. (You can only use the 90 day trial period clause if you have 19 or fewer employees and have not employed this candidate before).

Ensure you are using the latest Employment Agreements from Employers Assistance. Get our Recruitment Package now, on offer this month Click here
This is free to Employer Support Package members.