Employment Contracts

Employment contracts may be written or oral. Employment contracts may be provided to employees who would not otherwise accept employment without the security of a contract, or in cases where the employer wishes to secure certain protections, such as the protection of confidential information or trade secrets. Employment contracts typically set forth the term or length of employment, compensation and benefits, job duties, and circumstances for termination. Some contracts also may include provisions relating to confidentiality, assignment of intellectual property rights like patents or copyrights, and non-compete agreements.

In recent years, Minnesota courts have used contract-based theories to carve out exceptions to the employment at will doctrine for public policy reasons. For example, the courts have found a contract to exist where the employee provides something of value, in addition to performing the job, in exchange for a promise of continued employment. A contract also has been found where the employee, in reliance on an offer of employment, gave up another job to accept employment. Most recently, Minnesota courts have determined that statements in a personnel handbook may create an enforceable contract if the terms are sufficiently definite, are communicated to the employee, and the employee accepts the terms and provides value by continuing to work. Implied contracts may be found to exist in other situations.

In cases where employees are represented by a union, the employer and the collective bargaining agent negotiate a contract which governs the relationship of the parties throughout its term.

An experienced employment attorney is helpful in recognizing areas of weakness in contracts your company currently considers as “standard.” It is recommended to have an employment attorney review your basic contracts and employee handbook on a yearly basis to ensure that your company is compliant with all new laws. Anytime there is a complex employee contact, it is always best to involve an employment attorney. The attorney will ensure that the companies goals and interests are represented in the best way possible. If for any reason the company would like to cancel their employment contract, they should first confer with an attorney to assess all possible consequences. An initial investment with an attorney could save your company countless time and money.

For additional information on employee handbooks see this resource page.