Do I Really Need One?
An employment agreement is a legal contract that sets out the terms of employment for your employees, including title, working hours, duties and salary. In addition, the contract can specify what happens when the employment ends, whether because the employee resigns or is terminated. Hiring new employees in Ontario without an employment contract means that those employees will receive all of the benefits available to them under the Ontario Employment Standards Act, 2000 and otherwise available to them by law. In particular, without an Ontario compliant employment contract, your employees may be entitled to receive up to the maximum notice of termination (or pay in lieu of notice of termination) available to them by law if they are terminated.
Permanent or Fixed Term Employees
Employees can be hired on a permanent basis (with no pre-determined term or end date), or on a fixed term basis where the employer and employee have agreed to a fixed term for employment. There may be significant financial exposure if you decide to terminate fixed term employees who do not have a fixed term or temporary employment contract compliant with Ontario law.
Temporary or fixed term employment contracts, when drafted properly and compliant with Ontario law, can limit those termination entitlements and allow for much greater flexibility for employers and much lower financial risk exposure. These employment contracts, like all employment contracts, must be drafted in compliance with Ontario employment law or you will risk the contract being deemed to be void or unenforceable as a result. That’s why it’s important that you have Ontario lawyers draft the contract for you.
Pay Once, Use Forever
We know what you’re thinking. Do I need to pay for a new employment agreement for every employee I hire? No! Employees with similar roles generally have similar contracts. We can prepare a standard employment agreement template for you to use with all of your employees, and you just fill in the specific details each time you hire a new employee. Beware that employees with significantly different responsibilities or duties may need unique contracts tailored to their specific roles.