Our agency has never
required employees to sign employment contracts, but due to the
recent losses of major accounts taken by departing employees, we
are thinking of requiring them. Aside from post-employment
covenants, what should such contracts say?
A: Every agency should have written contracts
with all of its front-line employees. Contracts spell out each
party's expectations and contribute to job satisfaction because
employees know what is expected of them and what isn't.
I realize that most agency owners would read the previous
paragraph and say, "I would never ask the ladies and gentlemen of
my agency to sign a contract. We don't need contracts, and asking
my people to sign would alienate them."
However, based on my experience, most agency owners would be
wrong. You need these contracts, and you can get your employees to
sign.
Of course, the most important clauses in employment contracts
deal with post-employment covenants. As you probably know, the
ability to enforce covenants varies from state to state. You can
find my 2001 column on covenants, "Noncompete laws vary by state."
So, let's cover five other provisions that should be in your
contract:
• You need to protect your client list, prospect list and any
trade secrets that you have. To do this, the employee must
acknowledge the confidentiality of the information and promise not
to disclose it during the term of the agreement and thereafter.
• You need to specify that the employee's "work product," such
as proposals or group costing forms, belongs to the agency and not
to the employee. Otherwise, the employee may claim that everything
he produces belongs to him.
• You must specify that either party can terminate the agreement
"at any time, for any reason or no reason at all." This prevents an
employee from claiming that you promised never to fire him or to
fire him only for cause.
• You should state that company policies and programs that are
not in the contract do not bind you. Otherwise, employees will
claim that they are legally entitled to perks and benefits that you
have always deemed discretionary.
• Upon termination of employment, employees must give up their
Iatan cards. If you don't specify this, I don't see how you can
insist on return of the card, as the card is not your legal
property.
Mark Pestronk is a Fairfax, Va.-based attorney specializing
in travel law. He answers your questions in the TravelWeekly.com
Legal Ease forum. To contact Mark directly, e-mail him at [email protected].