BUSINESS
STARTING A NEW JOB?
WHAT TO CONSIDER WHEN REVIEWING YOUR EMPLOYMENT CONTRACT Getting a job offer is generally excellent news. Having successfully gotten through the application and interview process, few people are keen to kick-start their new career by appearing to be ‘difficult’ about the terms of their new employment contract. It is, however, important to take the time to read and understand the agreement. If down the road things go pear-shaped and you find yourself receiving a letter terminating your employment, the terms of that contract may take on particular significance. Here are some items to consider: 1.Non–Competition Clauses: As a general principle, Canadian courts are reluctant to enforce non-competition clauses in employment contracts because they limit a person’s freedom to work in his or her area of expertise. If there is such a clause in your contract you may want to consider asking the employer to remove it. Potential employers may see the non-competition clause as a possible risk which could be enough to rule you out as a candidate. 2.Termination Clauses: The purpose of having a termination clause is to give both the employer and the employee some certainty about how matters will unfold when the employment relationship comes to an end. The Employment
Colleen Hoey, Mann & Partners, LLP.
Standards Act, 2000 sets out the minimum amount of notice (or pay in lieu) that the employer must give if the decision is made to terminate your employment (without cause). Generally speaking, the minimum standards are usually less than the amount a workers without an employment contract would be entitled to receive at common law. You may want to consider negotiating for notice that is more in line with the common law. 3.Vacation: Employees must, at a minimum, receive 2 weeks’ vacation a year and receive at least 4% of wages as vacation pay. Contracts with “use it or lose it” language which provide that you must either take vacation or else the vacation entitlement disappears may fall afoul of the provincial legislation. 4.Discretionary Bonuses: If your contract provides a bonus at the employer’s discretion, ask to have the bonus pay process spelled out. Generally it is a percentage of salary given for meeting a target that is agreed to in advance. The more central bonus payments are to your compensation package, the more important it is to have clearly laid out targets along with a common understanding of how successfully achieving those targets will be measured.
5.Start Date: Where an employee starts working without signing a contract, a Court will apply the common law to answer questions like “what kind of notice is the employee entitled to?” If you have already been working for an employer when they present you with an employment contract it is worth understanding what you might be giving up (along with what you may be gaining). 6.Reference to Other Documents: If your employment contract states that you have read and agree to be bound by certain corporate policies or procedures, make sure that you are provided with a copy of those policies and that you review them before you sign. Colleen Hoey is an Ottawa-based lawyer practicing in the areas of Employment Law, Human Rights Law, and Civil Litigation at Mann & Partners, LLP. The information in this article is not intended as legal advice. Should you require legal advice, please contact Mann & Partners, LLP 613-722-1500 or www.mannlawyers.com
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