Employment Contract Red Flags To Look For

While most employment contracts are fairly standard, these contracts do differ, and candidates can never assume they know what the contract consists of.

As a professional, it’s key to avoid toxic work environments and only sign an employment contract after thoroughly analyzing every word it contains. However, because contract terminology can sometimes be confusing and challenging to understand, you can also consider consulting an employment lawyer when in doubt before signing an employment contract.

With this, we’ve listed the most common employment contract red flags to look out for as a professional in any industry.

Indefinite Non-Compete Agreements

Even though non-compete agreements and clauses are typically commonplace in an employment contract, especially in competitive industries, it’s still essential to be sure the clause will not later restrict your career path or land you in pressing trouble with the law. When employees sign non-compete agreements, a business relationship is established between the employee and the business. Therefore, employers can take legal action in the event of a clause breach.

A reasonable non-compete agreement should not limit an employee for longer than a year or two following contract termination or end. Moreover, the clause should only be relevant to a reasonable radius of company location, depending on the industry.

If your employment contract contains a non-compete agreement, it’s wise to have an employment lawyer determine if the clause is reasonable. In addition, you can also consult an employment lawyer if you need to get out of a non-compete agreement.

One-Way Indemnities

Indemnity clauses in employment contracts will state provisions that assign tasks and expenses in the event of a contract breach. This clause will outline the actions your employer can take against you when breaching the contract.

However, this clause must also highlight your rights in a breach. If the contract does not include your rights as an employee, you should reconsider signing.

Ownership Of Your Work

For creative roles, contracts that award ownership of your work as intellectual property are not ideal. As a result of this type of clause, you won’t have ownership of your own work. Even though you will still be able to use your work as part of a portfolio, it’s critical to safeguard ownership as a creative professional.

High-Pressure To Sign The Contract

Another major red flag to look for when securing a new job role is environments where you are pressured to sign the employment contract quickly. Unfortunately, this does not mean that the company is desperately in need of your valuable skills, but it’s far more likely means your employers don’t want you to have enough time to identify contract red flags.

It’s essential to read through any type of contract before signing the dotted line, whether you’re signing up for a new gym contract or job hunting. Contracts are legally binding, so it’s wise to know what you agree to. If you are experiencing difficulty understanding a contract, it’s best to consult a specialized lawyer to assist.