An employment contract sometimes seems like a standard document, but in practice that is precisely where things regularly go wrong. An incorrect probationary period clause, a forgotten interim notice clause or a non-competition clause that has no legal standing can have major consequences for employers.
In this blog, we discuss common mistakes in employment contracts and provide practical points of interest for employers. This will help you avoid legal risks and ensure that your employment contracts are in line with current laws and regulations.
1. An invalid probation clause
A probationary period is an important means of assessing an employee’s suitability for the position. Yet probationary clauses are regularly included incorrectly.
For example, sometimes a probationary period is mistakenly agreed to in an employment contract of six months or less, or a longer probationary period than permitted by law. In such cases, the clause may be invalid and termination during the probationary period can lead to wage claims or damages.
It is also frequently overlooked that an employee has previously worked within the organization, for example through an employment agency. In that case, there may be successive employership and a new probationary period is often no longer permitted, especially if the work is the same or similar.
In addition, discussions arise in practice when an employee joins or performs work prior to the official start date. Under circumstances, this can lead to discussions about when the employment contract actually started and, therefore, when the probationary period began to run.
Therefore, always check:
- Whether a probationary clause is legal;
- Whether successive employership may be involved;
- Whether the employee has not actually started before;
- and whether the clause is in writing and properly recorded.
2. The absence of an early termination clause.
With temporary employment contracts, the interim notice clause is regularly forgotten. Without such a clause, a fixed-term employment contract cannot in principle be terminated before the end date.
This can cause problems in cases such as dysfunction, a labor dispute or changed business conditions.
Do you want to maintain flexibility? Then always include a written interim termination clause in temporary employment contracts.
3. An insufficiently motivated competition or relationship clause
In temporary employment contracts, a non-competition or non-solicitation clause is only valid if there is a compelling business or service interest. Moreover, that interest must be motivated in writing and specifically. A standard sentence is usually insufficient.
In the absence of proper justification, as an employer you run the risk that the clause will not stand.
Also pay attention to promotions or job changes
Employers frequently assume that a non-competition or non-solicitation clause automatically remains valid throughout employment. This is not always the case.
Indeed, in the event of a major job change or promotion, a non-competition clause may start to weigh more heavily on the employee. In that situation, it may be necessary to re-agree the clause in writing.
4. Errors in the penalty clause
Penalty clauses are also frequently worded incorrectly in law. For example, it is sometimes included that the court may not mitigate a fine, even though the court does have that authority by law.
In addition, it is regularly erroneously provided that in addition to a contractual fine, full damages can always be claimed for the same violation. Additional legal rules also apply to penalty clauses towards employees, including on the destination of fines collected.
A carelessly worded penalty clause may result in the clause being invalidated in whole or in part.
5. Forgetting the notice requirement
Temporary employment contracts of six months or longer are subject to a legal obligation to give notice. Employers must then give written notice no later than one month before the end of the contract whether the employment will be continued.
This obligation is regularly forgotten in practice. This can result in a notice fee of up to one gross monthly salary.
Employment contracts require customization
Drafting an employment contract is not a standard formality; it is legally customized. Every company and position requires clear agreements that fit the practice within the organization.
Do you want to know whether your employment contracts are still in line with current laws and regulations? The employment lawyers of Wessel Van der Lans Advocaten support employers in drafting, assessing and updating employment contracts.
