Your Dispute Resolution Partner

What is required for a valid employment contract?

To form a valid, enforceable contract, three things are required: an offer, an acceptance, and consideration. Consideration, in legal terms, means that both parties must have given up something in exchange for the bargain reached. This can be as simple as the promise of the employee to work and the promise of the employer to pay the employee for their work.

An employment contact can be written or unwritten. Where issues of confidentiality exist or an employer wishes to protect itself against future competition from a former employee, it is preferable to execute a written contract. A written contract can also set out what constitutes reasonable notice on dismissal.

The terms of an employment contract can include the duties the employee is expected to perform and when they are expected to perform them. It can also include prohibited conduct either during or after the employment relationship. Written contracts also often set out the terms of how the employment relationship may be brought to an end, and whether any notice or compensation that the employee is entitled to at the end of the relationship is limited to the statutory minimums set out in the Employment Standards Act. Generally, both parties will be bound by the terms of the written agreement.

In the case of an unwritten contract of employment, when disputes arise a court will generally read in terms, often referred to as “implied terms”, based on what the court believes the parties would have agreed to had they sat down and negotiated a written contract. Common implied terms include the provision of reasonable notice or compensation in lieu in the event of termination.

For More Information

Fill out our online form