With home repairs, there is risk in DIY. Similarly, employment agreements require the input of an expert. If you’re not an employment lawyer, don’t try this (i.e. drafting or revising an employment agreement) at home.
When a company promotes an employee, the employer should provide the employee with a new contract to sign prior to allowing the employee to commence his or her duties. In that way, the company is providing the employee with “fresh consideration” to make the contract enforceable. Consideration is the legal word for the exchange of something of value to make contracts enforceable and in a promotion it takes the form of the increased salary that comes with the new job. If the company allows the employee to be promoted and then has the employee sign an employment contract after the promotion has already taken place, there is a chance the employee can argue the terms of the contract that were not discussed pre–promotion should not be enforced for lack of fresh consideration rendering the terms of the contract unenforceable.
It appears that the saga of judicial interpretation and consideration of termination clauses will continue, with predictably unpredictable results. Courts will enforce termination clauses that limit an individual’s entitlement to notice of dismissal, but the onus will be on the employer to show that the clause should be enforced.
Recent court decisions changed how the law applies to employment contracts, most importantly terminations, but also off-duty conduct, consideration and restrictive covenants. Important lessons from the changes are that employers need to review their employment contracts, you can update them or change their terms while complying with the law, and failing to do so can damage your organization’s finances and reputation.
The three most viewed articles on HRinfodesk this week deal with an updated version of the 2014 compensation forecast; how the principle of a pay cut without consideration prevails; and the termination of an impaired employee despite mitigating factors.
Gender identity and access to women’s washroom facilities Would it be discriminatory to prohibit a pre-operative, male-to-female transsexual from entering a women’s washroom? The answer should be of interest to any employer or business offering services or accommodation to the public. (In PDF) Performance review must take into consideration a person’s disability An employer discriminated […]
A regular issue for employers is whether the provisions in their employee handbook are enforceable in the same manner as an employment contract. Many employers are surprised to find that they are not…
I read an interesting case recently that could be considered controversial: an employer was permitted to contract out of its human rights obligations with some vulnerable employees who were at an economic disadvantage and who experienced significant language barriers. How did the employer accomplish this? The employer added a provision in its termination letter that offered the employees consideration in exchange for signing releases preventing them from launching a human rights complaint.
One crucial piece of advice that I offer to employers is to have every single employee sign an employment agreement that, if nothing else, sets out what will happen in the event of dismissal without cause. The reason for this suggestion is simple: without a contractual dismissal provision, an employer’s obligations in the event of dismissal without cause are unpredictable and often extensive.