Employment Contracts, Handbooks & Policies
Legally sound contracts and policies are effective tools that help create transparency and predictability in the workplace. Our team can help you develop contracts and policies that are flexible and consistent with your brand and culture, but also protect your business and minimize liability.
Our Employment & Labour Group works closely with local businesses, management and human resource professionals to develop and maintain clear, useful employment contracts, policies and handbooks, and help them deal with any existing problems or complaints initiated by employees. Often times, through careful planning Employers can avoid these issues all together, along with the hefty legal fees that are involved in resolving a legal battle.
HR Done Right! Tips from our Employment Lawyers:
Tip #1: All employees should have signed written employment contracts with an enforceable termination clause.
Why? It is a fundamental principle of employment law that employees who are terminated without just cause are entitled under “common law” to reasonable notice of termination, or pay if the employer does not want to provide advance working notice.
Where there is no enforceable written employment contract, a court will set the reasonable notice period of up to 24 months, or even more in exceptional circumstances, taking into consideration their age, years of service, position, the job market, and other factors.
Employers are permitted to circumvent the reasonable notice that a court would otherwise award by specifying another period of notice in the employment contract. However, the contractual notice must still comply with the minimum requirements of employment standards legislation.
The difference between what is required at common law versus employment standards can amount to tens, if not hundreds of thousands of dollars. As such, a well-drafted termination clause in a written employment contract is a useful tool for employers to provide both clarity and certainty regarding their obligations upon terminating the employee.
Tip #2: It’s never too late to have employees sign a written employment contract, as long as you provide “fresh” consideration.
When you enter into a new employment relationship with a prospective employee, the consideration you’re providing the individual is work (employment), salary, benefits, etc. In return, the consideration the individual is providing to you is signing off on your terms and conditions (or verbally agreeing to them) and providing you with services.
Once the employee starts working, you can no longer offer the consideration of employment in exchange for a new contract, and if you try it will not be enforceable.
Modification of a pre-existing contract (verbal or written) will likely not be enforced unless there is a further benefit to both parties. Mere continuance of employment by the employer is not viewed by the courts as constituting consideration. There must be adequate consideration and adequate consideration requires something more than the bald promise that the employee will not be immediately terminated if they don’t agree to the new terms. Continued employment alone is not regarded as consideration for a new covenant extracted from an employee during the term of employment because the employer is already required to continue employment until there are grounds for dismissal or reasonable notice of termination is given.
Courts have provided some indication as to what is sufficient and insufficient consideration: a one-time bonus, a raise or combination of bonus and more vacation time can be deemed sufficient consideration for the variation of an employment contract.
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