How Well Do You Agree? How an Effective Employment Contract Can Benefit Both Employer and Employee in Alberta

All About Employment Contracts in Alberta

Employment contracts are essential for employers and employees alike. They are legal documents that set out the details that govern the relationship and obligations between the employer and employee. Unfortunately, many people sign an employment contract in Alberta without understanding those details.

People feel they do not have a say in it because they need that job. In truth, if the employer selected you among all other candidates, then what you say is crucial as you offer your services. That means reading the contract and signing it only if you understand the requirements. These tips were made for you in good faith. But if you have doubts about what you are signing, it’s best to contact an employment lawyer for legal advice.

The Basics: What is an Employment Contract?

An employment contract or agreement is simply the specified terms of your relationship with your employer. It sets out your compensation, work hours, responsibilities, benefits, and many other things. Contracts are designed to define the employee-employer relationship and protect the interests of both parties.

In general, when you sign an employment contract, you look for the things that interest you the most: salary or wages, work hours, and benefits, including vacation time. However, what the majority of people need to consider is a non-competition term in an agreement. In other words, the company prohibits you from working in the same industry after being let go. There are many terms that people ignore, but the agreement you sign also decides your fate in the future. 

What Does an Employment Contract Need to Contain?

Let’s look at the terms one employment contract in Alberta contains apart from your and your employer’s information. Each role is specific and contains different terms of the employment contract. Depending on your job, you can expect the following:

Employee Earnings

Employment contracts must state the salary, wage, or commission in Canadian currency agreed upon between the employee and employer. These are usually paid once a month, daily, weekly, bi-weekly, or semi-monthly. In addition, the employers are obliged to pay the agreed amount within ten consecutive days from the end of the pay period.

Working Time

The employment contract in Alberta includes working days and hours. According to Alberta standards, employees may work up to 12 hours daily. That consists of an entitled 30-minute break every 5 hours. By law, there has to be at least one non-working day in the week. If an employee has worked for the same employer for at least 30 workdays in the 12 months preceding the holiday, they are entitled to general holiday pay.

Duration of Employment

Each contract has to contain the duration of employment. It can be a permanent position or an ongoing contract and can have a specific time. This means the agreement will have to end at some point, although both parties may agree to extend it. If you are working temporarily, your employer might decide not to renew your contract.

Workplace Responsibilities

An employment contract has to list various duties and tasks a worker is expected to fulfill while being employed. These are things that the employer expects you to do and which you agree to do. In addition, employers often include a clause that states they can change your position, tasks, and salary. In other words, look out for this, as it can mean you will earn less in a different place.

Benefits

A contract should outline all promised benefits that may include but are not limited to health insurance, vacation time, and other perks that come with the job. By Alberta employment standards rule, an employee is entitled to vacation with pay after a full year of employment. 

Confidentiality Clause

Regardless of whether you sign a non-disclosure agreement, the employer might include a confidentiality statement in the employment contract. A confidentiality clause in an employment contract is intended to ensure that the employee does not disclose sensitive data secrets to a competitor. This obligation applies during and after employment termination, and the law makes no provision for this clause.

Non-Compete Clause

A non-compete clause is sometimes included in a contract. This is a statement that an employee agrees not to work on jobs in the same industry or those that directly compete with the employer. It can be a separate agreement or included as a clause in the employment contract. 

Materials Ownership

A contract may state that the company retains ownership and control of all communications and materials employees create during employment. This is common in the case of patentable inventions, where a company will want to retain ownership of anything that could be worth money on the market. However, it can also apply to simple email correspondence and other documents.

Termination Clause

A termination clause is often a way for an employer to state that they will not provide reasonable notice of dismissal and give their period, naturally agreed by both parties. Typically, the termination clause will enable the employer to terminate the employee and provide significantly less severance than the employee would receive. However, a court will not enforce a termination clause unless it allows the employee to at least meet the minimum statutory entitlements upon dismissal as required by the Employment Standards Act.

What are the three types of Employment Contracts?

The nature of your employment will define the type of contract you have. Each of these types of employment contracts is subject to the Employment Standards Code’s obligations. In addition, the type of employment contract will determine the termination clause, in which the terms are different for each contract.

Indefinite Term: An unlimited-term contract means working indefinitely with no set end date. This is the most common type of employment contract. It defines that your employment relationship can be terminated by either party as long as it is done according to the agreement. It may also include a notice period before termination if you are employed for more than 12 months.

Fixed Term: You can also have a fixed-term contract. This contract defines the exact length of your employment, usually with an end date. The employer may renew the contract if they wish to continue employing you after its expiry date.

Project-Based: This type of employment contract is used for specific projects and can be renewed if the employer wants to continue working with you. It may have a set start date and end date or be open-ended.

Conclusion

An employment contract is a legal document that confirms an employer-employee relationship for the duration of its term. An employment contract establishes employees’ rights to wages, benefits, and other rights during employment. Employment contracts protect both the business and the employee. They provide a set of mutual expectations and obligations for both parties involved in this agreement. 

However, many employers abuse and bend the rules to get more out of the deal. That means you should read the contract carefully before you sign anything. If you have trouble determining whether your employment contract is fair, never sign an employment contract without speaking with an employment lawyer first. 

Chapman Riebeek’s expert lawyers in Alberta can help you review all aspects of your employment contract.