Employment agreement
This Employment Agreement (the “Agreement”) is made as of [Effective date] between:
[Employer legal name], a [corporation / limited liability company] organized under the laws of [Jurisdiction], with its principal office at [Employer address] (the “Company”); and
[Employee full name], of [Employee home address] (the “Employee”).
Background
The Company wishes to employ the Employee, and the Employee wishes to be employed by the Company, on the terms in this Agreement. The Employee acknowledges that the Company's agreement to employ them, and the pay and benefits described below, are good and valuable consideration for the obligations the Employee accepts in this Agreement.
1. Definitions
“Confidential Information” means all non-public information, in any form, that the Employee receives or creates in connection with their employment and that relates to the business of the Company or its affiliates, customers, suppliers or partners, including business plans, finances, pricing, customer and supplier lists and terms, personnel information, product plans, source code, designs, data, research, know-how and trade secrets. It does not include information that is or becomes public through no fault of the Employee, or that the Employee can show was lawfully known to them before employment without a duty of confidence.
“Work Product” means all inventions, works of authorship, software, designs, data, documents, processes, improvements and other materials, whether or not patentable or registrable, that the Employee creates, alone or with others, during employment and that relate to the Company's actual or reasonably expected business, or that result from work done for the Company, or that use the Company's time, equipment, facilities or Confidential Information.
“Applicable Employment Standards” means the minimum employment standards legislation that applies to the Employee's employment, such as the Employment Standards Act, 2000 (Ontario), the Canada Labour Code, or applicable US federal and state wage-and-hour laws.
2. Position and duties
The Company employs the Employee as [Job title], reporting to [Manager title]. The Employee will perform the duties normally associated with that position and other reasonable duties assigned by the Company consistent with the Employee's skills and experience.
The Employee will devote their full working time and attention to the Company's business, act honestly and in good faith, follow lawful and reasonable instructions, and comply with all Company policies that apply to them, as updated from time to time.
3. Start date and term
Employment begins on [Start date] and continues for an indefinite period until ended under section 12. The Employee's service with [Prior entity, if any] will [be / not be] recognized for the purposes of seniority, notice and benefits.
4. Place of work and hours
The Employee's normal place of work is [Office address / remote within Province or state / hybrid]. The Employee will not move their primary place of work to another province, state or country without the Company's prior written approval, because this can change tax, payroll and employment law obligations.
Normal hours are [Hours] per week. The Employee may be required to work reasonable additional hours. The position is [eligible / not eligible] for overtime pay under Applicable Employment Standards; where eligible, overtime must be approved in advance.
5. Compensation
Base salary. The Company will pay the Employee a base salary of [Amount] [Currency] per year, less required deductions, paid in line with the Company's regular payroll schedule. The Company will review base salary at least once a year. Any increase is at the Company's discretion.
Incentive pay. The Employee is eligible to participate in [Bonus or commission plan name] on the terms of that plan, with a target of [Target amount or percentage]. Unless the plan or Applicable Employment Standards require otherwise, a bonus is earned only if the Employee is actively employed on the payment date and has not given or received notice of termination.
Equity. [Any equity award is governed solely by the applicable equity plan and award agreement. / Not applicable.]
6. Benefits
The Employee is eligible to participate in the Company's group benefit and retirement plans offered to similarly situated employees, subject to the terms and eligibility rules of those plans. The Company may change or replace its benefit plans at any time, as long as it continues to meet its legal obligations. Coverage is provided by insurers or plan administrators, and benefit decisions are theirs, not the Company's.
7. Vacation and leave
The Employee is entitled to [Vacation days] days of paid vacation per year, prorated for any partial year, to be scheduled at times approved by the Company. Vacation accrues and may be carried over only as Company policy and Applicable Employment Standards allow.
The Employee is entitled to statutory holidays and to all protected leaves under applicable law, including leaves for illness, family responsibilities, pregnancy, parental care and bereavement, together with any additional leave under Company policy.
8. Expenses
The Company will reimburse the Employee for reasonable business expenses properly incurred in performing their duties, in line with the Company's expense policy, on submission of receipts within [Number] days.
9. Confidentiality
During employment and at all times afterwards, the Employee will keep Confidential Information strictly confidential, will use it only to perform their duties for the Company, and will not disclose it to anyone except Company personnel and advisors who need it for the Company's business.
The Employee may disclose Confidential Information if required by law, court order or a regulator, after giving the Company prompt notice where legally permitted so that it can seek protection. Nothing in this Agreement prevents the Employee from reporting a possible violation of law to a government agency, from cooperating in a government investigation, from discussing wages or working conditions where the law protects that right, or from making disclosures that are protected by whistleblower law.
US trade secret notice. Under the US Defend Trade Secrets Act, an individual is not criminally or civilly liable under any federal or state trade secret law for disclosing a trade secret in confidence to a government official or to a lawyer solely to report or investigate a suspected violation of law, or in a complaint or other document filed under seal in a lawsuit or other proceeding.
10. Work Product and intellectual property
All Work Product, and all intellectual property rights in it, belong to the Company from the moment of creation. To the extent any Work Product does not automatically belong to the Company, the Employee assigns, and agrees to assign, to the Company all right, title and interest in it worldwide.
The Employee waives, in favour of the Company and its successors, licensees and assigns, all moral rights they have or may have in the Work Product, to the extent permitted by law, including under the Copyright Act (Canada).
The Employee will promptly disclose Work Product to the Company and, during and after employment, will sign documents and take other reasonable steps the Company requests, at the Company's cost, to record, register and enforce its rights.
This section does not apply to any invention that the Employee developed entirely on their own time, without using the Company's equipment, supplies, facilities or Confidential Information, and that does not relate to the Company's business or result from work performed for the Company, to the extent a law (such as California Labor Code section 2870 or similar laws in other states) protects such an invention. The Employee has listed in Schedule A any inventions they made before employment that they want excluded; if none are listed, the Employee confirms there are none.
11. Outside activities, conflicts and restrictions
Outside work. During employment, the Employee will not take on other paid work or a business interest that competes with the Company, conflicts with their duties, or materially affects their performance, without the Company's prior written consent. Passive investment of up to 2 percent of the shares of a public company is allowed.
Non-solicitation of employees. For [12] months after employment ends for any reason, the Employee will not directly or indirectly solicit or encourage any employee of the Company with whom they worked in the last 12 months of employment to leave the Company. General job advertisements not targeted at Company employees are not a breach.
Non-solicitation of customers. For [12] months after employment ends for any reason, the Employee will not directly or indirectly solicit any customer of the Company with whom the Employee had material dealings in the last 12 months of employment for the purpose of selling products or services that compete with those of the Company.
Non-competition. [The Employee will not, for Number months after employment ends, work in a role that competes with the Company within Geographic area. / This Agreement does not contain a non-competition obligation.] Many jurisdictions restrict or prohibit non-competition clauses, including Ontario for most employees and several US states, so this clause must be reviewed before use.
The Employee agrees that these restrictions are reasonable and necessary to protect the Company's legitimate interests, including its Confidential Information and customer relationships.
12. Ending employment
Resignation. The Employee may resign by giving at least [Notice period for resignation] weeks' written notice. The Company may waive some or all of that notice by paying base salary for the waived period.
Termination for cause. The Company may end the Employee's employment at any time for just cause, or for wilful misconduct, disobedience or wilful neglect of duty as those terms are used in Applicable Employment Standards, without notice or pay in lieu, except any amounts that Applicable Employment Standards require even in those circumstances.
Termination without cause. The Company may end the Employee's employment at any time without cause by providing: (a) notice of termination, pay in lieu of notice, or a combination; (b) severance pay, if required; and (c) continuation of benefits for the statutory notice period, in each case equal to [the minimum required by Applicable Employment Standards / the greater of Number weeks of base salary per completed year of service and the minimum required by Applicable Employment Standards]. The Employee agrees that these amounts satisfy all notice, severance and other entitlements on termination, whether under statute, contract or common law.
At-will employment in the United States. If the Employee works in the United States, their employment is at will, meaning either party may end it at any time, with or without cause or notice, subject only to any payments expressly set out in this section and required by law.
Minimum standards. If any part of this Agreement provides the Employee with less than the minimum required by Applicable Employment Standards, the Employee will receive that minimum instead, and this Agreement will be read as if it provided that minimum. This applies to every termination clause in this section.
Final pay. On termination for any reason, the Company will pay all earned and unpaid base salary, accrued and unused vacation pay, and approved expense reimbursements, within the time required by law.
13. Return of property
When employment ends, or earlier if the Company asks, the Employee will return all Company property, including devices, access cards, documents and files, and will permanently delete Confidential Information from personal devices and accounts after returning a copy to the Company. On request, the Employee will confirm in writing that they have done so.
14. Personal information
The Company will collect, use and disclose the Employee's personal information only for purposes related to managing the employment relationship and as permitted or required by applicable privacy law. The Employee acknowledges that Company systems may be monitored as described in the Company's electronic monitoring policy.
15. Remedies and survival
The Employee agrees that a breach of sections 9, 10 or 11 could cause the Company harm that money alone cannot fix, and that the Company may seek an injunction in addition to any other remedy. Sections 9, 10, 11, 13 and 14, and any other terms that by their nature should continue, survive the end of employment.
16. Independent legal advice
The Employee confirms that they had a reasonable opportunity to review this Agreement and to obtain independent legal advice before signing, that they understand it, and that they are signing it voluntarily.
17. Governing law and disputes
This Agreement is governed by the laws of [Province or state] and the federal laws of [Country] that apply there, without regard to conflict-of-laws rules that would apply the law of another place.
If a dispute arises, the Company and the Employee will first try in good faith to resolve it by discussion between people with authority to settle it, for at least 30 days after one of them gives written notice describing the dispute. If the dispute is not resolved in that time, either of them may start proceedings in the courts located in [City, Province or state], and each submits to the non-exclusive jurisdiction of those courts.
Nothing in this section prevents anyone from seeking urgent injunctive or other interim relief from any court with jurisdiction to protect confidential information, intellectual property or property, or to prevent irreparable harm.
18. Notices
Any notice under this Agreement must be in writing and delivered by hand, by courier, by registered mail, or by email to the address shown in the signature block or another address given by notice.
A notice is received: when delivered, if delivered by hand or courier on a business day before 5:00 PM local time at the place of receipt, and otherwise on the next business day; on the fifth business day after mailing, if sent by registered mail; and when sent, if sent by email before 5:00 PM local time of the recipient on a business day with no automated message that it was not delivered, and otherwise on the next business day.
Routine operational communications may be sent by any reasonable means, but a notice of breach, termination or a claim must also be sent by a method listed above.
19. Entire agreement and general terms
Entire agreement. This Agreement, including any schedules and documents it expressly refers to, is the entire agreement about its subject matter and replaces all earlier discussions, proposals and agreements about that subject matter, whether written or oral.
Amendments and waivers. A change to this Agreement is effective only if it is in writing and signed by each party. A failure or delay in enforcing a right is not a waiver of it, and a waiver of one breach is not a waiver of any other breach.
Assignment. No party may assign this Agreement without the prior written consent of the others, which will not be unreasonably withheld, except that an organization may assign it without consent to a successor to all or substantially all of its relevant business or assets by giving written notice. This Agreement binds and benefits the parties and their permitted successors and assigns.
Severability. If any provision is found invalid or unenforceable, it will be limited or removed to the minimum extent necessary, and the rest of this Agreement stays in full force.
Interpretation. Headings are for convenience only. The words “including” and “includes” mean “including without limitation”. Amounts are in [Currency] unless stated otherwise. A reference to a law includes any amendment or replacement of it.
Language. The parties have expressly required that this Agreement and all related documents be drawn up in English. Les parties ont expressément exigé que la présente entente et tous les documents connexes soient rédigés en anglais.
20. Counterparts and electronic signatures
This Agreement may be signed in any number of counterparts, each of which is an original and all of which together form one document.
The parties agree that this Agreement may be signed and delivered electronically, including through an electronic signature service such as eSora Sign. An electronic signature, and a signed copy delivered by email or as a PDF, has the same legal effect as a handwritten signature on a paper original, to the extent permitted by applicable law, including the U.S. Electronic Signatures in Global and National Commerce Act (ESIGN) and the Uniform Electronic Transactions Act (UETA) as adopted in the relevant state, Part 2 of the Personal Information Protection and Electronic Documents Act (PIPEDA), and provincial electronic commerce legislation in Canada.
Each party consents to receive this Agreement and related notices electronically, and agrees that the electronic record of the signing process, including any certificate of completion and audit trail, may be used as evidence that this Agreement was signed and of when it was signed.
Schedule A: Prior inventions
The Employee lists here any inventions, works or other intellectual property that they made or own before the Start date, alone or with others, that relate to the Company's business and that they wish to exclude from section 10. If disclosure would breach an existing confidentiality duty, the Employee lists only a general description and the party to whom the duty is owed.
Title and description: ______________________________
Date created: ______________________________
Owner or co-owners: ______________________________
[ ] No prior inventions to list.
Signatures
By signing below, each signer confirms that they have read and agree to this Agreement and, where they sign for an organization, that they are authorized to bind it.
EMPLOYER REPRESENTATIVE
Organization: [Legal name of organization]
Name: ______________________________
Title: ______________________________
Signature: ______________________________
Date: ______________________________
Email for notices: ______________________________
EMPLOYEE
Name: ______________________________
Signature: ______________________________
Date: ______________________________
Email for notices: ______________________________