In North Carolina, it’s important for a company to have employment contracts signed for certain employees, but in many cases, employers aren’t sure what should be included in that agreement.

Typically, a company’s key workers have employment contracts to expand upon the employer’s ultimate goals for their employees while simultaneously acknowledging the employees’ specific skill sets. Knowing what should be included in a North Carolina employment contract can guide employers and let potential employees know what they expect.

Who Needs an Employment Contract?

Before determining what should be included in a North Carolina employment contract you must first determine whether or not certain employees need a contract. Not all employees need an employment contract since they require both the employer and employee to devote energy and time to come up with a specific agreement that protects all parties. 

Employment contracts are usually appropriate for a company’s officers, key employees, management-level staff, and salespeople. Each of these employees would benefit from working under an employment contract.

What Should be Included in an Employment Contract?

The ideal employment contract should go over the job’s key duties in clear and concise details so that all parties are on the same page regarding what is expected of the new employee. The contract should also explain the benefits offered by the company that the new employee is entitled to receive. 

In addition to outlining the benefits offered, the employment contract should document the exact amount of compensation the new employee can expect to receive so that there is no confusion regarding the agreed-upon salary amount. 

Employment Contracts With Non-Compete Clauses

Some employers operate businesses that routinely grant employees access to confidential information such as customer lists. These lists give employees access to the names and contact information of all current and past customers of the company and could cause hardship for the company if the information is shared with competitors or used to try to draw customers away from the company. 

Other confidential details can include databases with industry-specific knowledge and proprietary information whose loss could potentially damage the company. The noncompete clause must be designed to provide legitimate protection to the business’s interests without infringing upon the employee’s right to later pursue their profession after leaving the company. 

As long as the noncompete clause is designed to provide reasonable protection to the employer’s business without imposing hardship on the employee, it can be used to safeguard the employer’s interests.

The enforceability of noncompetes can vary state by state – read more about the enforceability of noncompetes in North Carolina.

Benefits of an Employment Contract

Employment contracts have many benefits for both the employer and employee. Both parties can receive the protection they need while avoiding confusion caused by miscommunication and misunderstandings during the hiring process. 

Employment contracts can also be used to help retain key employees such as founders and managers after a business merger or the acquisition of a new company.

An employment contract can also make benefit arrangements clear to new employees. The contract can include the employee’s base salary, incentive pay, potential bonuses, stock options, and any other benefits that the employee is entitled to. 

Including this information in the employment contract can help avoid confusion and ensure that the new employee is aware of the compensation structure before they start working. It gives the employee a chance to ask questions and also provides the employer with a written record of the benefit structure negotiated between the company and the employee.

Right to Terminate Employment

There are times when an employee is simply not a good fit for the company. Sometimes they are unable to perform the job tasks they were hired to perform, they do not adhere to company policies, or they disrupt the workplace in other ways. 

Even though North Carolina is a right-to-work state, it is important to avoid a situation where an employer is unable to terminate an employee without just cause, so you should list your right to terminate employment for any reason by including it in the employment contract.

Contact Our North Carolina Employment Attorneys

Having a valid employment contract in place can provide your business with the protection it needs to operate legally in North Carolina. It can take some of the guesswork out of termination questions and help retain valuable employees. 

When the time comes to craft your company’s employment contract, it’s critical to have an experienced employment attorney by your side. At Green Mistretta Law, we can work with you to create an employment contract that meets your business’ needs while providing your business with the protection it deserves. Contact our offices today to schedule an initial consultation so that we can answer your questions and provide you with the legal assistance that you need.