Understanding Employment Contracts: Types, Terms, and Legal Implications (Full Transcript)

Speaker 1: As you may know, contracts are legally binding documents where your policy or your employee handbook is the Bible in terms of how the company operates and the conduct you want your employees to follow. To break it down further for you, you are legally bound by your contract. That's why if there's a breach of contract from either party, so yourself or the employee, you can be sued for a breach of contract. There are a number of different contracts that you may issue to an employee, such as permanent, temporary, ad hoc contracts, specified purpose contracts, fixed terms, seasonal, annualized contracts, and apprentice contracts. One that often comes up a query around is the young person's contracts. It's important for you to recognize what type of contracts you require, and it's important for it to reflect actual day-to-day running of that relationship. There's no point in issuing a contract, for example, to an employee, issuing a contract that is a 40-hour contract or 20-hour contract, whereas the employee works 40 hours. It has to reflect the actual practical side of things. The general rule that I would advise on is look back 13 weeks as a reference period to know what kind of contract the employee requires if you are stuck in terms of you're not sure what contracts to issue to the employee. The essential elements of contracts will go into a few of the terms, such as the implied terms or the statutory terms, implied terms, expressed terms. The statutory terms of employment are referred to the Terms of Employment Act 1994-2001, and it says that there should be 15 requirements within the employee contracts. These range from the full names of the employer and employee, the address or registered place of work, the title of the job, the day of commencement, the rate or calculation of the employee's remuneration, any terms and conditions relating to hours of contracts, any terms relating to paid leave, pension schemes, the period of notice that the employee is required to give you, which are also bound by. The implied terms, on the other hand, are not written or spoken, but it governs the employment relationship. So for example, if you have been given employees 25 days a year of annual leave, you cannot simply just switch back to giving them 20 hours or 20 days after giving them, you know, 25 for the last three years, for example. So these are implied terms. The implied terms also are governed by the common law. So these are the duties that can be applied to the employer and employee. So examples would include duty of care, for example, or trust and confidence, or duty of good faith and loyalty. If the employer breaches any of these duties, then the employee may be able to pursue a civil breach of contract. Okay. So the express terms, and I'm sorry, I'm going really fast with this, but again, you will have time for questions after this. So the express terms clearly state that it can be in writing or orally. And these are terms, comments, agreements made at the interview stage.