As a business owner, you get to determine how you want to hire employees to work at the company. In many cases, they are just at-will employees. They have an agreement to work at the company, and they have probably signed some onboarding documentation, but they do not have an official employment contract. Instead, they just work at the business for as long as both of you want that relationship to continue.
But if you want to have more control over these employee relationships, you can introduce employment contracts. What are some of the potential benefits of doing so?
Advance notice when an employee leaves
For one thing, at-will employees do not technically have to give two weeks’ notice before they quit. That is not a legal obligation. It is often considered good business etiquette, but that does not mean an employee is required to do so.
However, if you use an employment contract, you can specify how much notice they have to provide. This can help things go much more smoothly for your business if you have to bring on new employees to replace those who are leaving.
Using noncompete agreements
Likewise, an at-will employee can quit their job at any time and go work for the direct competition. You have no say in what they do after their employment ends.
But the FTC recently vacated its ban on noncompete agreements, so you can use these documents to stipulate where employees can work after they quit. For instance, you may be able to mandate that they cannot work for direct competitors in the same area as your business or for a set amount of time after they leave their job.
In other words, employment contracts simply give you a far greater level of control, which can be very beneficial. It is important to know exactly what legal steps to take when setting them up.
