What is an employment agreement?
An employment agreement is an official document that the employee and employer enter into in good faith. The definition of the term "employment agreement" under the Employment Relations Act states that it:
a) Means a contract of service
b) Includes an employee's terms and conditions of employment in a collective agreement; or an individual employment agreement.
Upon the employer offering the employee the job that is on offer, the employer will provide all new employees with a copy of the employment contract which will outline their standard terms and conditions of employment prior to, or on their first day of joining the organisation, which will be the basis of the legal employment relationship between you and the organisation.
The contract of employment will specify your full terms and conditions concerning your duties, place of work, contracted hours and statutory entitlements. In the event of conflict, your standard terms and conditions of employment shall prevail. Any employee benefits will be detailed in your standard terms and conditions of your employment along with any additional benefits that have been negiotated within a collective agreement.
There are two forms of employment agreements:
Collective Agreements (CA): A binding agreement which has been negiotated with one or more unions; and one or more employers; and two or more employees (s54)
Individual employment agreements (IEA): An employment agreement entered in to by one employer and one employee who is not bound by a collective agreement that binds the employer (s65)
Any employment agreement that is offered by the employer must contain minimum statutory legislation rights, covering areas such as: minimum wages, annual leave, probationary periods agreed, public holidays, sick leave, parental leave, bereavement leave.
It is also good practice to state the details of the probationary periods that have been agreed, the disclipinary process and disputes process that the organisation follows.
For further information on employment agreements, check out the ERA Act or Department of Labour website listed below.
HR Tool Kit:
- Individual Employment Agreements
- Probationary Periods
- Casual Employment
- Employment Agreement Guide, Clauses to Add and Builder - Ministry of Business, Innovation and Employment
- Employment Legislation
- Adult Minimum Wage