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4 contract clauses that can prevent disputes with employees

Running a business is demanding and complicated; legal disputes only make things more difficult. This is why it is crucial to take steps to prevent them if you own a business here in North Carolina.

One step you can take is to have in place clear, purposeful and enforceable employment contracts with your employees. These documents can serve as essential tools to prevent and address disputes so that they do not erupt into costly legal battles. Below are four critical components to consider including in your employment contracts.

  1. Non-compete agreements: These clauses serve as a way to prevent your employees from going to a competitor and performing the same type of job for a certain amount of time. This limits competition between businesses and prevents former employees from soliciting your customers.
  2. Arbitration clauses: Should a dispute or disagreement arise, an arbitration clause specifies the manner in which it will be resolved. When both parties agree to an arbitration clause, they agree to go through arbitration rather than litigation. 
  3. Confidentiality clauses: Certain employees have access to sensitive, valuable information as a result of their work. To protect this information from being shared with the public or other companies, you can have employees sign a confidentiality agreement.
  4. Compensation and benefits terms: Including information about compensation structures and company benefits like sick days, vacation time and health insurance in an employment contract ensures that you and the employee are on the same page regarding these items.

These are just some of the pieces that can fit together to create a comprehensive employment agreement. By putting this information in a legally enforceable document available to employees, you can ensure that you are clear and open about the expectations and parameters of the relationship.

However, while these can all be effective, understand that they may not be necessary in every case for every worker. Further, certain clauses may not be valid or enforceable under certain circumstances. 

To discuss your options as well as how you can best use these and other contractual clauses to avoid disputes and/or build a case in the event of a violation, it can be wise to discuss your legal options with an attorney.

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