You will find contract in all the things you do, whether you purchase a home, car or a bus ticket, everything is a written contract. At some point of time we all enter into employment, to earn and grow further in life. Whether you are hired as an executive employee or as a CEO of the company, you will be signing an employment agreement with the company.
It is essential that you must sign the employment agreement, because it not only acts as a proof of your employment but also contains the duties that will be performed by you. Employment agreements help in providing senior executives and key employees with a written understanding of certain ceo compensation, benefits, perquisites and rewards.
All the key factors of the job are clearly highlighted in the agreement, and the employee is bound to perform their duties as per the agreement. Company provides remuneration in exchange of the service acquired from an employee. Almost all the employment agreements start with recital where the first recital is usually agreeing to the employee the executive at a certain level by consent of all the board of directors of the company.
Following are the main provisions of the Executive employment agreement:
1. Employment Term: the term of the contract should be mentioned clearly. Moreover you should also make clear if the agreement is renewable or not.
- Compensation: this includes employee’s annual salary, appraisals, deductions, provident funds etc. should be clearly mentioned in the compensation clause.
- Duties of employee: this clause should clearly state the duties to be performed by the employee. All the details of the duties change of duties, transfers etc. should be mentioned in the agreement.4. Confidential information: well it should be in clear understanding of the employer to keep the information of the agreement confidential. In most of the companies the compensation clause is to be kept confidential.
5. Noncompetitive: this clause states that the employee hired by the company should not work directly or indirectly as an owner, partner, manager, of any business that is direct competition to the company.