MECH 3360 - Employment Contract

Engineering Economics - Lecture 12

Are employment contracts legally binding?

They are not until both employer and employee agree to the terms and conditions outlined.

List some parts of an employment contract.

The employees name, job title, location, starting date for the position, department information, etc.

What do employees get that contractors do not when it comes to employment contracts?

Contractors do not get the same benefits offered compared to full time employees.

Why would the job description and duties be listed on an employee contract?

It is important if the job description has been changed or tailored for the employee.

What is included along side the agreed-upon salary and benefits in an employment contract?

Additional compensation and bonuses that might have been negotiated.

True or false. Changing employment by employer is considered as termination in the ESA.

True

What are restrictive covenants? Are they legally binding?

Clauses in the contract that restrict what employers and employees can do during and after the employment relationship. They are legally binding, regardless if it is expressed written or orally.

An employer commonly must prove than an employee should be fired with just cause. What should they prove?

If they told them clearly what the standards are, told them that they weren’t meeting standards, had reasonable time to meet said standards, was warned termination, and still didn’t meet expectations after all of the above.

True or false? Employers need to provide written notice or pay if they fire an employee for just cause.

False, no written notice or severance pay is required.

What causes an employee to be terminated without just cause?

Downsizing, restructuring, or personal fit.

A company does not have to provide reasons for termination without cause, but they must provide the employee of what?

A notice of termination, severance or termination pay in lieu in notice.

What is a termination clause?

A termination clause is a passage of an employment contract that defines an employees right to notice, severance, or termination pay.

Without a termination clause, what is the basic principle of employment law in BC when employees are terminated without cause?

That all employees are entitled to a reasonable notice of termination unless stated otherwise in an agreement.

Under common law, notice periods may be provided for reasonable notice. However, the length of the common law notice depends on many factors. List some of these factors.

Length of service, age, position, and availability of a similar employee in the job market.

Not all employment contracts have a termination clause. What is assumed when no termination clause is given?

That the employee is given common law rights to notice.

Under what circumstances is a termination clause unenforceable?

If the employer could, or otherwise, provide less notice than the federal minimum, if it fails to provide the same benefits during the notice period, or of its confusing.

What is a non-competition clause?

A limit on an employees ability to directly or indirectly compete with the employer or to join a competing company during or after employment for a set period of time.

What is a non-solicitation clause?

A limit on an employees ability to take other employees or existing and potential clients from the company during or after employment for a set period of time.

What is a confidentiality agreement?

A limit on an employees ability to discuss or disclose and confidential information that the employee may become aware of during their employment.

Courts generally view restrictive covenants as mechanisms that limit competition in the market as well as an employees ability to sign contracts and utilize work skills. It is because of this reason that…

Restrictive covenants are generally void unless carefully drafted.

Restrictive covenants are enforceable if?

It is for the general purpose of maintaining a competitive advantage, or if the employers interests are to be protected.

True or false? The absence of a restrictive clause does not result in the employee being permitted to compete, solicit, and disclose confidential information.

True.

What identifies a fiduciary employee?

It is an employees position that charges them with initiatives that take them beyond the role of servant and into the realm of an agent of their employer.

True or false? An employee is not longer fiduciary upon termination.

False. An fiduciary employee maintains their obligation to not exploit their advantages even upon termination.

Does every employee need a contract?

No. The law does not require small business to make legal promises to their employees.

It is illegal to not give a contract of employment?

It depends. To avoid paying tax or national insurance it is, but in cases if they don’t know if you will be paid it is fine.

Can a company change your contract of employment?

Its terms cannot be lawfully changed by the employer without agreement from the employee.

What is a pre-need contract?

A type of arrangement where one pays for products and services ahead of time, particularly for funerals.

In the case of Donaldson v. Murphy, what was the main reason for the court siding with Murphy?

The non-solicitation clause was deemed unenforceable due to no limits on time and geography.

In the case of Globe and Mail v. Jan Wong, what was the main reason for the court siding with the Globe and Mail?

Jan Wong breached their non-disclosure agreement by publishing a book that contained several references to their settlement.