The 7 steps to create great employment contract templates (Pt.1)

By / August 11, 2015 / / 2 Comments

This is the ultimate guide to creating a perfect Employment Contract Template.

Creating an employment contract for new hires is one of the most time-consuming aspects of the HR function. The conditions of employment for new employment contracts is a maze of law and compliance.
The Fair Work Australia website has 9 employment contract templates for new staff. There are also 5 for pay slips and record-keeping, 5 for hours of work, 7 for work and family, 5 for managing performance, 6 for managing underperformance and 3 for ending employment.

Managing 40 different employment contracts can be a nightmare! To make things easier for you, we’ve taken the employment contract process down to the basics. Whether you’re a season HR Pro or you’ve never sent an employment contract before, this is the guide for you.

Here are 7 steps you can take to simplify your employment contract process:

1. Decide on the type of employment contract you’re creating.

employment contracts
Source: National Library of Ireland

You have three broad employment contracts to pick from: Full-time, part-time or casual. On top of this, each contract can either be for a fixed term or project (eg. a ‘contractor’) or on an ongoing basis. This will be decided by the nature of the work. Factors such as hours of work available, minimum entitlements to the employee and obligations to the employer influence the employment contract.

The minimum entitlements that change in employment contracts are:

  • pay
  • hours of work
  • shift penalties
  • loadings
  • leave entitlements and
  • notice of termination.

 

The changes will be based on whether the employment contract is full-time, part-time or casual.

You can create your letter of engagement once these entitlements on your employee contract have been decided.

2. Craft your letter of engagement with the employment contract template details.

Your letter of engagement must address all the criteria listed above. Your new hire must be aware of all the entitlements in their employment contract before they can accept the offer.

Creating letters of engagement can be time-consuming at best, and frustrating at worst. Using templates is a great way to save time on letters of engagement.

You can have a template for each type of employment contract, or each function of your business.

The Fair Work Australia template is a great place to start. All the fields you need to change are highlighted in red. Drop the entitlements into the template and you’re ready to go!

You’ll just have to change these fields in the Fair Work Australia template:

  • the letterhead,
  • date,
  • position title,
  • employer name,
  • location,
  • award name,
  • enterprise agreement name,
  • hourly rate,
  • weekly/fortnightly/monthly income,
  • your contact name
  • your phone number.

Much easier than writing a letter of engagement from scratch.

Now you can send your letter of engagement to your new hire. From there, you just need to wait for the new hire to receive the letter, give them time to decide on the offer and wait for them to send it back.

While you’re waiting, you can create a new job checklist.

3. Create an induction program to prepare your organisation and a ‘Starting a new job’ checklist for the new hire.

employee contract templates
Source: National Library of Ireland

Make sure your induction program matches up with the ‘starting a new job’ checklist for the new hire. Having these two forms work together is the secret to a great experience on a new hire’s first day.

Both forms should include where new employees need to go on their first day, what time they start and who they need to report to.

Remind them to bring their employment contract, tax file number declaration form and superannuation choice form. They’ll need additional information such as bank account details, licences, proof of age, qualifications and emergency contact details.

Once they’ve been prepared with uniforms and tools, they’ll almost be ready for work.

Sound like a lot of work? Centralise your employment contracts online.

You’re not even halfway through the steps for creating employee contracts. Check out part two of our series on creating employee contract templates.

Or you can book a demo to see how HROnboard can automate employee onboarding for you. Manage all your employment contracts online with a single draft template. All your changes can be managed with drop-down boxes instead of editing yellow highlights.

Streamline your back-office so you can spend more time helping employees do a great job, instead of getting them ready for work.

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