Things to Look Out for in Your New Employment Contract

After getting a new job you should be given an employment contract, which stipulates important things such as the terms of your position, how much notice you have to give and so on. This contract is an agreement between the employer and the employee, and both parties will be bound to the contract until it ends, or until the terms are changed by agreement. It’s vital that you read through the contract before signing it, as there could be some hidden terms that you didn’t expect. Below we talk you through some of the things to look out for before you sign on the dotted line.

Restraint of trade clauses

Sometimes there are terms in a contract which restrict an employee’s freedom to work for a period of time after they leave their employment. These clauses are added in to protect an employer’s interest, including things such as confidential information, trade secrets and client base. Terms like this can take employees out of the market place for a certain period of time after they leave a job, so you need to look out for them.

Length of notice

You should always know how much notice you have to give to your employer if you want to leave your job, and how much notice they have to give you if they want you to leave. Longer periods of notice aren’t always good, as they could stop you from quickly moving onto a new job. The statutory period of notice is one week for every year worked, up to a maximum of 12 weeks. You should try to make sure the notice period are of equal length, as employees can sometimes be stuck having to give a much longer period of notice than employers.

Mobility clauses

Some contracts will state that an employee can be moved to work within a certain distance of the current role. You need to watch out for these, because if you can’t change your place of work when they ask then you may lose any redundancy pay that you could otherwise have been entitled to. Look out for this type of clause beforehand and negotiate with your employer where you’d be able to move to, as a way of avoiding any trouble later down the line.

Flexibility clauses

This kind of clause means that an employer can change the employee’s duties without consultation, or alter some other aspect of the employment relationship. If a clause like this is included then you should try and make sure that it’s as narrow as possible, so the employer doesn’t have too much flexibility if they want to change your job description. If a flexibility clause doesn’t exist in your contract then any changes to employment will have to be agreed by both parties.

Bonuses and commission terms

Discretionary bonus terms that are drafted too widely in a contract can negatively impact the employee. Bonuses should be based on specific formulas, such as individual targets, rather than being up to the employer’s discretion. This is so that the employer doesn’t just have free reign when it comes to handing out bonuses. Elsewhere, any commission clauses need to be checked to make sure that an employee isn’t refused money because they are under notice or if they have left.

If you’re about to sign an employment contract then you should read all of the terms carefully, to make sure that nothing will surprise you down the line. Harrison Dear can give you the guidance you need when switching jobs, so get in touch with us today.