What Should Businesses Include In Their Employment Contracts?

 Posted on April 03, 2025 in Business Law

United States and Florida employment law is at-will, meaning that both the employer and employee can terminate the employment at any point and for any reason. As a rule, employers may hire employees without entering into an employment agreement. However, there are situations in which an employer might wish to define the employment relationship in an official agreement. In these cases, there are certain common provisions that employers should include. An experienced Broward County, FL business law attorney can guide you through the process of drafting an employment agreement.

When Should You Have an Employment Agreement?

While it is not mandatory to have an employment agreement, in some cases it is advantageous. For example, if you are hiring for a high-level position and want to provide an incentive to retain the best talent, an employment agreement can be a draw. Additionally, it can ensure that you lock in the employee for a certain period of time. This may be a good idea if the employee is necessary to run the business during a key event such as a merger, for example.

What Should You Include In Your Employment Agreement?

There are a few common provisions that you should include in your employment agreement:

Compensation and Benefits

The section that details employee compensation should include information about the salary and stock options. If the employee is eligible for a bonus, you can include information about the bonus. Consider what your policy for granting bonuses is, and how specific you want to be about performance expectations.

Intellectual Property

Intellectual property is a valuable business asset. You should add a provision in your employment agreement that specifies that any intellectual property belongs to the company.

Severance

In some cases, offering a severance package can provide an incentive to recruit top talent. A section on severance will outline the employee’s compensation in the event that the employment relationship ends.

Dispute Resolution

Your employment contract should outline what happens if there is a dispute between you and the employee. Will you compel the parties to resolve their differences in arbitration? What is the jurisdiction and venue in which you want disputes to be litigated?

Confidentiality

You should include a section that ensures the employee keeps proprietary business information confidential.

At-Will Employment (Or Not)

An important decision to make when drafting the employment agreement is whether the employment will be "at will" or not. If it is at will, you will want to define the at-will nature of the work and refrain from guaranteeing employment for a specific amount of time or requiring the employee to give two weeks’ notice before resigning.

Call a Broward County, FL Business Law Attorney 

Although it is not necessary to enter into an employment agreement with your employee under Florida law, when it is the best option for your business, you can turn to the experienced Fort Lauderdale, FL business law attorney at The Elliot Legal Group, P.A. to draft and negotiate your employment agreement. We represent businesses in employment contract negotiations and are committed to protecting your company and its best interests. Call our offices at 754-332-2101 to schedule a consultation.