Employment Contracts

An employment contract is an agreement between an employer and employee that sets out terms and conditions of employment.

Did you know Australia is one of the very few countries in the world where an employment contract can be written or verbal (P.S. We don't recommend verbal)?

This is why it’s essential you don’t say throw away lines to potential employees in an interview, such as:

·         “You’ve definitely got the job, I’m just waiting for some other approvals”

·         “You’re my preferred candidate and I’ll make sure you get the job, it’s a sure thing”

DO NOT offer a job until all decision makers are satisfied you’re offering it to the right person.

Here are the reasons why:

A ‘contract’, written or verbal is just a name for an agreement that meets certain criteria in Australia. Once that criteria is met, it’s enforceable by law.

Here’s the criteria:

1.       Offer and acceptance:

o   This is why you never make an offer until you are 100% certain you want to. If you suggest to an applicant they have the job and they accept, this is a verbal contract which is binding.

2.       All of the terms must be agreed upon:

o   Don’t be fooled by this, terms are often spoken about during the interview and accepted by the applicant, e.g. Job title, responsibilities, who they will be reporting to, who will be reporting to them, pay. You may think ‘all of the terms have not been agreed upon’; however, often they have already been covered in the interview and/or job advertisement; and agreed upon.

3.       The parties must intend to be legally bound:

o   Someone applying for a position in your business typically understands they will be legally bound to the requirements of your business and the role; otherwise, they probably wouldn’t be applying for the job. As the employer, you already expect and understand this. Therefore, this criteria is often met at the interview stage.

4.       Consideration, that is something of value must be exchanged in the transaction:

o   This refers to pay and conditions. Again, often discussed during the interview stage, therefore it has often already been covered.

A written contract is always recommended, please don’t inadvertently offer a verbal contract.

Information is current as of posting date, 05/10/2022 and may be subject to change.