Employment Contract

Introduction

The Employee Agreement is a legal document specifying the terms and conditions of employment of an employee in the respective organization in which he/she is or will be working and contributing his human input. Employment Agreement is a type of contract commonly executed when a business hires a new employee binding both the parties to follow the clauses as mentioned in the said contract. It may have a range of different employment types like full time, part time and the fixed term.

It set out all of the terms of employment, including the job duties, salary & Remuneration benefits which can be availed, working hours, confidentiality, leaves including annual and monthly and various other key terms.

In most of the cases, once a new employee is recruited, both the employer and employee wants to get started without any delay. However, the employer may wish to first start by providing the employee a letter which states some of the key terms in brief. In these kinds of situations the employer uses a Letter of Offer followed by the Employment Agreement.

The employment agreement is required to be printed on stamp paper which is to be signed by both the employer and the employee and shall keep a copy of the same for their own records.

Note:- An Employment Agreement is not suitable for the contractors and they are recommended to use another legal agreement which is called a Service Agreement.

Legal Window has a team of experts providing you with the best assistance, timely delivery and guaranteeing the highest customer satisfaction with respect to legal drafting of contracts. You may get in touch with our team on 072407-51000 or email admin@legalwindow.in

Advantages of Employment Agreement

Safeguarding the Interest of Employer

Safeguarding the Interest of Employee

Setting Expectations for the development of organization as well as employee

Listing down the Laws of Employment

Process of Drafting Employment Contract/Agreement

1. Placing request
As we receive a request from you for drafting an Employment  Contract/Agreement, our expert team will share a questionnaire to be filed by you for taking your request forward.


2. Drafting of agreement
After receiving the said questionnaire and the information relevant for drafting of the Employment Contract/Agreement we will begin to draft the same and if in need we require any other information the same will be sought by us through a call. Drafting of agreement might take 2-4 business days.

3. Sharing of Ist draft
Once the agreement is ready from our side we will share a draft of the same with you for final approval. If you find the same in order the final copy will be shared in a day and if corrections or additions are required then the same will be revised and verified by our team

4. Sharing of Final Agreement
Our experts will do the needful and the same will be shared with you as final agreement.


Content for the Employment Contract 

Name of the Employer

Name of the Employee

Terminologies and the definitions of terms for reducing the miscommunication

List of clauses governing Employee Agreement like scope of work for both parties

Responsibilities and duties of both Employer and Employee

Stamp Duty;

Signature of both the parties involved

Working hours and leave

Remuneration

Confidentiality and Non Disclosure

Intellectual Property Rights

Non- Competing Clause

Termination of Employment

Arbitration Clause

Dual Employment i.e. one must not take multiple jobs at one point

Is it Compulsory to print the Employment Contract on Stamp Paper

An agreement becomes legally enforceable when it has been properly stamped and the required stamp duty has been paid on the agreement irrespective of the fact that whether an agreement is printed on a letter head of the company or on a plain paper or on a stamp paper. The stamp duty differs from state to state.

Section 17 of the Indian Stamp Act, 1899 states that “All instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution”

Section 2(14) of the Indian Stamp Act, 1899 also defines “Instrument” as “every document by which any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded”.

Thus, from the provisions it can be concluded that in order to maintain the legal validity of an agreement a right amount of Stamp Duty should be paid depending upon state to state.

Employment Contract Laws

There are various laws applicable for employment services and the said employment is sometimes subject to the terms and conditions of the applicable laws. Each state has their own Shops and Establishments Act which lays down certain terms and conditions regarding the working hours, overtime etc to be done by an employee

Sample of Employment Contract Laws 

FAQs on Employment Agreements

What is the need of having an employment agreement in writing?

There are certain advantages of having a well-written employment agreement which are as follows:

  • Existence of high level of specificity with regard to the terms of employment;
  • Existence of provisions like dispute resolution which protects in case any dispute between the employer and the employee
  • For developing a positive relationship between the employer and the employee as it is also an important perspective.
Is it necessary to print the Employment Agreement on the letterhead of the organization?

An agreement becomes legally enforceable when it has been properly stamped and the required stamp duty has been paid on the agreement irrespective of the fact that whether an agreement is printed on a letter head of the company or on a plain paper or on a stamp paper as the Section 17 of the Indian Stamp Act, 1899 states that “All instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution”.

Can a standard Employment Agreement be executed?

Yes, one may have a standard Employment Agreement with subtle modifications pertaining to the position at which the employee is admitted, qualifications of the said employee, the experience that an employee has and other such factors as may be necessary. An organization is able to hire satisfied and productive employees if they are willing to alter to make amendments to the Employment Agreement depending upon such factors. However, the overall provisions of the Employment Agreement must be uniform.

Whether the Letter of offer and the Employment Agreement are the same?

No, the letter of offer and the employment agreement both are different from each other. As the letter of offer lays down the terms and conditions along with the benefits that the company is willing to provide to the employee.

The Employment Agreement is the second stage after going through the letter of offer and negotiation carried out between the employer and the employee and thereafter that the terms which are finally agreed upon between the employer and the employee forms a part of the employment agreement.

Is it mandatory to pay stamp duty on the Employment Agreement?

An agreement becomes legally enforceable when it has been properly stamped and the required stamp duty has been paid on the agreement irrespective of the fact that whether an agreement is printed on a letter head of the company or on a plain paper or on a stamp paper. The stamp duty varies from state to state.

As per the Section 17 of the Indian Stamp Act, 1899 which states that “All instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution”

Section 2(14) of the Indian Stamp Act, 1899 also defines “Instrument” as “every document by which any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded”.

Thus, from the provisions it can be concluded that in order to maintain the legal validity of an agreement a right amount of Stamp Duty should be paid depending upon state to state.

What are different kinds of Employment Agreement ?

There are mainly two kinds of Employment Agreement which are as follows:-

  • Collective agreement: It the case where the agreement has been negotiated with one or more than one trade unions;
  • Individual agreement: It the case where the agreement is been entered into personally between the employer and the employee;