Reviewing Your Employment Contract (Before You Sign)

23 March, 2012 | Carolyn Ranson

For most people, their job is a significant part of their life – therefore before signing a new Employment Agreement, you should ensure you are fully aware of what is and isn’t included, and how this could impact on you.

The benefit of getting a lawyer to look over a proposed employment agreement is to check that any terms and conditions verbally promised or agreed to are reflected in the agreement, whether there are any onerous or out of the ordinary obligations on you and to assist you in negotiating amendments to the proposed agreement.

In our experience what is verbally offered is often not reflected in the employment agreement – for example items such as car parks, health insurance or bonus schemes. It is important that any key terms are recorded with enough specificity so that the agreement can be relied on at a later date if needed for enforcement purposes. Negotiating terms and conditions prior to starting a new job is far more straightforward than attempting to resolve a disagreement over your entitlements after being in a job for a number of months.

Given the recent law change we are seeing more and more agreements that have a 90 day trial period included. It is important that employees are aware of this clause and its possible consequences. Other terms and conditions that we can advise on are any terms which are particularly onerous for an employee or provide for out of the ordinary obligations. For example, restraints of trade preventing an employee from working with competitors, within a particular industry, geography or with specific customers or suppliers following resignation.

Whilst not front of mind when an employee first starts a role, restraints can be onerous and impact on an employee’s ability to find paid work within their desired industry. Your negotiating power is a lot stronger prior to the commencement of the relationship as compared to the end of the relationship when you have or are looking to resign.

The common perception that restraints are not enforceable is incorrect. There is now a significant body of case law in which restraints are upheld by the Employment Relations Authority and Court. Furthermore, employers will fight to have restraints enforced. Therefore it is important that you understand and are comfortable with the scope and impact of any restraint before signing your proposed employment agreement.

Something else we have noticed given that a number of New Zealand companies are now owned by Australian entities, is that employment agreements prepared by companies with Australian ownership often either do not reflect the statutory minimum required in New Zealand law or include terms and conditions that are specific to the Australian working and/or legal environment. Depending on the nature of these, they may need to be amended prior to signing an agreement.

Finally, under employment legislation an employer is required to allow an employee to seek independent advice about an intended agreement and consider any issues that the employee raises in light of this. As well as pointing out key terms and conditions that you should attempt to renegotiate, a skilled Employment Lawyer can also provide you with advice on how to go about negotiating with your prospective employer.

Further advice

If you’re starting a new job and you’re an existing Smith and Partners client, we’ll review your employment agreement for only $350 + GST.  Click here for more details.

If you would like advice on any employment law related matters, please contact Suzanne Sumner, Personal Assistant to employment law expert, Carolyn Ranson to find out how you can become a client of Smith and Partners and to set up an appointment to discuss your employment matter with Carolyn.
Suzanne Sumner
Ph: 09 837 6840


Do you need your employment contract reviewed?

Contact expert employment lawyer, Carolyn Ranson today to set up an appointment.

email Carolyn
+64 9 837 6840

About the author

An experienced employment, estate litigation and elder law lawyer, Carolyn completed her law degree at City University, London in 1996. She was in house legal counsel for a large retirement village operator, before entering private practice in 2000. She joined
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