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Hidden clauses to watch out for in employment contracts, Part 2

There are advantages to being a contract worker if you are lucky enough to possess the skills that are in high demand in the marketplace. Companies are more than willing to secure the services of top-flight talent in the belief that their investment will yield dividends. And a contracted employee can enjoy the guarantees and perks provided by a written employment agreement.

However, as we discussed in a previous post, before signing a contract, it is important to understand all of the terms and clauses it contains. Remember, once you commit your signature to the agreement, you are legally bound to maintain your end of the bargain.

The following are a few clauses that are often found in employee contracts:

  • No additional compensation clause, which may state that you will not be entitled to extra pay for serving on a managing committee or elected office in the company.
  • Termination clause, which stipulates the conditions under which the contract could be terminated and the responsibilities of the employee and employer.
  • Best efforts clause, which helps clarify the duties you owe the company, including your active participation in contributing to the company's success and your obligation to work hard.

There are other clauses that involve dispute resolution. For example, an arbitration clause defines the manner in which arbitration will be executed. And a choice of law clause specifies which state's employment laws have jurisdiction over a dispute.

If you are about to commit your services to a company by signing an employment contract, you may want to have an experienced employees' rights attorney go over the fine print and fully explain its contents. And if you are in the midst of a contract dispute, an attorney could represent your interests as you seek a satisfactory resolution.

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