What is the importance of employment agreements


Employment agreements are documents which establish the terms and conditions, and details of the job and so on between a company and a new recruit. It is a document that is given to the newly hired employee preceding his joining, and it is a legal document as well. Hence, it has many uses and is an extremely critical document which must be perused carefully. Some of its primary uses are as follows:

  • An employment agreement outlines the details of the job, salary, additional perks, working hours, responsibilities and the like to a new employee. Thus, it provides information which is of value to the employee while at the same time it is a formal contract that attests to the company’s hiring of the employee in no uncertain terms.
  • This agreement also provides clarity and transparency to the process of hiring new employees. Since it is a legal document, the terms and conditions contained therein, and the offer made to the employee are recognized and ratified by law. Thus, neither the company nor the employee can misuse or breach the contract without incurring penalties.
  • Such an agreement also establishes a link between the company and the newly recruited employee. This is the first official communication between the two and thus it retains a particular importance for the employee which can hardly be accounted for.
  • An employment agreement also outlines the company’s policies on a number of issues. This is of immense help to a newcomer who may not be familiar with the rules and regulations of the company. Hence, it has informational importance and this must be recognized and appreciated.

Thus, there are many ways in which employment agreements are useful. Hence these types of agreements must be written well and with careful thought and with all legal requirements.

Category: Sample Agreements

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