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DIPLOMA IN OFFICE ADMINISTRATION
BUS 326 – BUSINESS LAW

INDIVIDUAL ASSIGNMENT
“CONTRACT EMPLOYMENT”

PREPARED FOR:
MR. FAISYAL

PREPARED BY:
MUHAMMAD FAMEY BIN ISMAIL
DOA 35
2177DOA613

INTRODUCTION

An employment contract is an agreement between an employer and employee that sets out terms and conditions of employment. A contract can be in writing or verbal. An agreement entered into between an employer and an employee at the time the employee is hired that outlines the exact nature of their business relationship, specifically what compensation the employee will receive in exchange for specific work performed.

An employment contract can help you attract and retain key employees. While you can't force employees to stay, a contract can ensure that they'll provide reasonable notice prior to departure--typically 60 to 90 days.

Employment contracts also help protect critical trade secrets, and are especially critical in high-tech companies. An employment contract can prohibit employees from revealing company secrets, working for the competition or soliciting customers. Non-compete agreements can be difficult to hold up in court, so you must be careful in drafting them..

Employment contracts are also useful when you're buying or selling a business to make sure key people don't leave. You can offer employees a retention bonus for staying or let them know they'll be forfeiting a valuable severance package if they leave.

Contracts also clarify individual jobs by spelling out employees' responsibilities, compensation, bonuses, stock options, rights to any inventions and patents, expense accounts and more. You can include an "evergreen" clause stating that the contract automatically renews on a given day each year if neither side provides notice of termination. And an arbitration clause can ensure that any employment-related dispute will be subject to binding

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