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Types of employment contracts

Your employment contract could vary depending on a number of different factors. Generally, it
will be determined by how many hours you work, but that may not always be the case. And
before you sign anything, it’s always vitally important to understand all the available options. To
help find out which one works best for you, here’s our guide on the different types of
employment contracts.

Full-time contracts
The most common type of employment contract is full-time. These contracts are generally
offered for permanent positions, and usually set out the employee’s salary or hourly wage. Other
details included within a full-time contract include holiday entitlements, pension benefits,
parental leave allowances, and details on Statutory Sick Pay (SSP). There is no set minimum
number of hours that you must work on a full-time contract. However, most employers recognise
full-time work as 35+ hours per week.

Part-time contracts
A part-time worker works fewer contracted hours than a full-time employee. However, they
generally also hold permanent positions, and their contract contains many of the same details as
their full-time counterparts. The number of hours they’re scheduled to work per week should be
clearly visible within the contract, but they may have the option to work overtime, if and when
desired. Benefits of part-time employment include a more flexible schedule, allowing individuals
to fit their work around other commitments, and the opportunity for people to try out new roles
without having to give up vast amounts of your time.

Fixed-term contracts
Fixed-term contracts last for a specific amount of time, which has been set and agreed in
advance. In some instances, fixed-term contracts may not include an exact timeframe, but will
instead end when a specific task has been completed or fulfilled. Fixed-term employees enjoy all
of the same rights and benefits as with any other permanent contract, although factors such as

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holiday entitlement will depend on contract length. Depending on the role, and an individual’s
performance, fixed-term contacts can sometimes lead to longer term positions.

Temporary contracts
Similar to fixed-term, temporary contracts are offered when a contract is not expected to become
permanent. Usually they would have some form of end date included, however, these may be
subject to change. As such, temporary workers may have their contracts extended in line with
demand and availability. Despite their short-term status, temporary workers are entitled to the
same rights as any other member of staff. Benefits of temporary contracts include increased
flexibility, the ability to manage work around study or other interests, and building experience
within a specific sector.

Agency contracts
Agency staff have their contracts agreed and managed by a recruitment consultancy or
employment agency. They usually work on a temporary basis, and the length of their contract
will depend on demand from the employer, as well as their availability. It will be the agency’s
responsibility to make sure their employees’ rights are protected. However, NI contributions and
Statutory Sick Pay will be paid by the employer to the agency you work for. After 12 weeks’
continuous employment in the same role, agency workers are then entitled to the same rights as
permanent employees of the company. 

Freelancers and contractors

When working on a freelance or contracted basis, contracts may vary from position to position.
However, individuals working in this way are generally considered self-employed, meaning that
it’s their responsibility to look after tax and NI contributions. Contracts may include start and
end dates, or the salary may be based on set projects or pieces of work, meaning the contract
effectively ends upon delivery. Freelance and contract workers may also not be entitled to the
same rights as more permanent members of staff, although they do get to manage their own
schedule, and negotiate their own terms.

Zero hour contracts

Also known as casual contracts, zero hour contracts specify that an employee works only when
required by their employer. The employer is under no obligation to provide a set amount of hours
to work. And, similarly, the employee does not have to accept any work that is offered to them.
Zero hour workers are, however, entitled to the same annual leave as permanent workers, and
their employer must pay them at least the National Minimum Wage to work. Individuals on a
zero hour contract may also seek employment elsewhere. In fact, their contract would not be
valid if it prevented them from looking for, or accepting, work from another employer.

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Employment Contract
This contract, dated on the ____ day of ______________ in the year 20____, is made between
[company name] and [employee name] of [city, state]. This document constitutes an employment
agreement between these two parties and is governed by the laws of [state or district].
WHEREAS the Employer desires to retain the services of the Employee, and the Employee
desires to render such services, these terms and conditions are set forth. IN CONSIDERATION
of this mutual understanding, the parties agree to the following terms and conditions:

1. Employment
The Employee agrees that he or she will faithfully and to the best of their ability carry out the
duties and responsibilities communicated to them by the Employer. The Employee shall comply
with all company policies, rules and procedures at all times.

2. Position
As a [job title], it is the duty of the Employee to perform all essential job functions and duties.
From time to time, the Employer may also add other duties within the reasonable scope of the
Employee’s work.

3. Compensation
As compensation for the services provided, the Employee shall be paid a wage of $___________
[per hour/per annum] and will be subject to a(n) [quarterly/annual] performance review. All
payments shall be subject to mandatory employment deductions (State & Federal Taxes, Social
Security, Medicare).

4. Benefits
The Employee has the right to participate in any benefits plans offered by the Employer. The
employer currently offers [list benefits, if any]. Access to these benefits will only be possible
after the probationary period has passed.

5. Probationary Period
It is understood that the first [time frame] of employment constitutes a probationary period.
During this time, the Employee is not eligible for paid time off or other benefits. During this
time, the Employer also exercises the right to terminate employment at any time without
advanced notice.

6. Paid Time Off

Following the probationary period, the Employee shall be eligible for the following paid time
off:

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  [length of time for vacation]
 [length of time for sick/personal days]
 Bereavement leave may be granted if necessary.
The employer reserves the right to modify any paid time off policies.

7. Termination
It is the intention of both parties to form a long and mutually profitable relationship. However,
this relationship may be terminated by either party at any time provided [length of time] written
notice is delivered to the other party. The Employee agrees to return any Employer property
upon termination.

8. Non-Competition and Confidentiality

As an Employee, you will have access to confidential information that is the property of the
Employer. You are not permitted to disclose this information outside of the Company. During
your time of Employment with the Employer, you may not engage in any work for another
Employer that is related to or in competition with the Company. You will fully disclose to your
Employer any other Employment relationships that you have and you will be permitted to seek
other employment provided that (a.) it does not detract from your ability to fulfill your duties,
and (b.) you are not assisting another organization in competing with the employer. It is further
acknowledged that upon termination of your employment, you will not solicit business from any
of the Employer’s clients for a period of at least [time frame].

9. Entirety
This contract represents the entire agreement between the two parties and supersedes any
previous written or oral agreement. This agreement may be modified at any time, provided the
written consent of both the Employer and the Employee.

10. Legal Authorization

The Employee agree that he or she is fully authorized to work in [country name] and can provide
proof of this with legal documentation. This documentation will be obtained by the Employer for
legal records.

11. Severability
The parties agree that if any portion of this contract is found to be void or unenforceable, it shall
be struck from the record and the remaining provisions will retain their full force and effect.

12. Jurisdiction
This contract shall be governed, interpreted, and construed in accordance with the laws of [state,
province or territory]. In witness and agreement whereof, the Employer has executed this
contract with due process through the authorization of official company agents and with the
consent of the Employee, given here in writing.

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