An employment agreement is an agreement which is signed by person recruiting and person giving consent to giving his services to a recruiter.

The terms of an employer and employee’s agreement depend upon nature, services rendered. Therefore, the agreement includes the duration for the exchange of services for the remuneration offered to the employee.

The statutes applicable to employer-employee relationship run in numbers and are complex. So, to avoid any discrepancies and dispute, there are certain essential points which must exist in an employee-employer agreement.

Working Conditions

Working condition plays a dynamic role in every course of employment. Also, it is one of the major aspects that need to discuss before entering any employment.

Apart from the working conditions, there are some essential aspects that need to be clarified between the employer and employee. These includes:
  1. Job Description

    It requires what kind of work to be assigned to an employee. Without a job description, it cannot enforce the agreement in a lawful manner.
  2. Leaves 

    Clause of leaves should be there to make it clear when leaves are granted. It can be a weekly holiday, national or public holiday or annual leave, sickness/casual leave, maternity leave or carry forward leave as per a company’s policy.
  3. Working hours

    According to the employment laws, an employee is supposed to work on a basis of 9 hours a day.  If an employee wishes to work beyond this specified period, it entitles him to get overtime as per the company’s policy.
  4. Remuneration 

    The clause should be essentially there in an agreement to settle the issues relating to the salary and the allowances offered to an employee to avoid any confusion relating to such payment terms in future time.
  5. Employment Term 

    It is the term which defines the validity of time or his existence in the company when in employment.
  6. Women Safety 

    When any women employee comes into the working operations of a company, it is mandatory to look after her safety and security. This can be achieved by setting up an internal complaints committee, by organizing regular workshops and awareness seminars, etc.
  7. Social Security Benefits 

    Employee’s insurance policies and provident fund are the important factors which should be taken into consideration for providing benefits with compliance of statutory laws like the EPF etc. to make the employee socially secure and enabling them to work with no hassle.

Enforceability of Employment contracts

Following are the factors which are required to be considered in enforceability these are:
  • Restraint of trade

    It specifies about the restriction by an employee not to engage or keep any business relations with another company who is also carrying the same line of business and it also applies to post-termination for a period.
  • Non-Compete clause

    It does not bound an employee to resign from the company whenever he wants in view of gaining some experience to start on his own. There are certain protocols which are required to be maintained by him.
  • Non-Solicit/Poaching clause

    When two employers which prohibit the other from enticing each other employee are enforceable as to the restrictions imposed is upon the respective employers.
  • Confidential clause

    The confidential clause is there to avoid any confidential matter to be released to the open public. It is also there to enforce the same from levying a penalty.
  • Dispute resolution mechanism

    The agreement should include a clause which provides with the mode of solving a dispute. Therefore, we should implement it with no hesitation.
  • Termination 

    Termination is one of the substantial parts of an employment agreement. While terminating an employee, it is to be taken into consideration, what is the reason to terminate such employee and whether the specified notice period has been given to him or not. However, in the cases of misconduct, the decision can be commenced without intruding the disciplinary committee. The company can terminate such employee even without notice but provides him with a reasonable opportunity of hearing.

Also, the company should also include the return of property policy in its clauses at the time when the employment ends which was being served to the employee while employed at the company.

  • Post-termination 

    It is mandatory to have a post-termination clause. It helps an employee to the non- disclosure terms of the company after his termination and prevents from working in a rivalry company or a company having the same line of business to keep the company and its policies safe.


The employment agreement is the core proof. It makes the employee bound with the employer and the company. It is in fact a condition precedent to frame the clauses of such an agreement with due diligence and scrutiny. The agreement should be vetted from time to time as per the changing conditions of the company and also as per the statutory legislation of the country where the company is situated.

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