Employment relationships often are not embodied in a written contract between employer and employee. Instead, most employment is of an “at will” nature, terminable by employer or employee on a moment’s notice, with or without cause. Some employment relationships should be embodied in written agreements, however. Where a business has one or more “key employees” – individuals who are central to the operation and the future success of the company – it makes good business sense to document these arrangements in a written employment agreement.
From the standpoint of both employer and employee, an employment agreement with a key individual should address the following important considerations:
- Term (duration) of Employment
- Bonus arrangements (sometimes called incentive compensation)
- Compensation (amount and timing)
- Employee benefits (insurance, vacation, pension and profit sharing, etc.)
- Protection of employer trade secrets
- Termination of employment (cause, without cause, notice etc.)
- Restrictions on post-termination competition and confidentiality
We favor the use of written contracts for key employees. Both employer and employee can benefit from a well drafted written employment agreement. Call us if we can assist in this area.