Have You Thought About Tightening Your Employment Contracts?
Written by Leah Waller
Senior Employment Consultant Solicitor
In January we set out a checklist of what MUST be included in your Employment Contract but, this month we take a look at some of those added extras that you, as an Employer, may want to include within your Employees’ Contracts…
It may be necessary for you to set out in the employment contract that overtime may be required and the terms relating to pay, hours and conditions for such overtime.
Deductions from future wages
This will be particularly important to allow you the right to make deductions from your Employees’ Wages for any overpayment of wages that are made, any training costs (and set out the reasons or circumstances in which deductions or repayment for training will be made), dame to Company Goods / Cars / Property etc.
Restrictions on employee’s actions during employment
This could include whether they are able to undertake any other employment during their employment with you and what the consequences of breaching such restrictions will be.
Payment in lieu of notice
Being able to pay an Employee in lieu of their notice period, rather than having them work out their notice period, is not an automatic or statutory entitlement, this must be stated as an option within their Contract of Employment.
Having such a clause within your Employment Contracts does not mean that you HAVE to make payment in lieu of notice for all Employees BUT it does give you the option.
Having the option to put an Employee on Garden Leave during their Notice Period allows you to have them remain in employment but have them not attend the Company premises, carry out any work or make contact with any Business Contacts, Clients or Staff.
This can be advantageous and allow you to pay their Notice over their Notice Period, rather than as a lump sum, and also allows you the control over their attendance at the Office or Company Premises and their contact with clients/suppliers/staff whilst also meaning that they cannot commence work for any other Employer or make use of any Confidential Information that they may have access to if they remained working as usual.
Lay-off and short-time working arrangements
Having the option to implement Lay-Off and Short-Time Working Hours and arrangement can be hugely beneficial where you experience a temporary or sudden downturn in work and you do not want to make redundancies but do not have enough work for all your employees.
An effective Confidential Information clause will enable you to protect you and your business from any leak or divulging of your confidential information, trade secrets, financial information and any other private information that could cause serious damage to your business.
Intellectual property rights created during work
An Intellectual Property clause, that is well drafted, will allow you to keep the rights, and patents if necessary, to any works that the Employee creates during their employment with you. These clauses can also be drafted to allow you to be an Attorney over any Intellectual Property Rights that may arise in the future on works the Employee created during their employment.
Post-Termination restrictions can allow you to ensure that your Employees cannot set up in competition with you, work for a competitor, solicit or encourage your employees, staff, contractors, consultants, suppliers, customers and/or clients to leave you, after they have finished employment with you. These clauses must be very carefully drafted to ensure they are valid and enforceable as they can quite easily be ruled as invalid and in such cases you will not be able to rely upon them.