The Ultimate Guide to Employment Contract Review

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Written By AndrewPerry

Founded in 2015 by a group of passionate legal professionals and enthusiasts, FlowingLaw started as a small blog. Today, it's a thriving community where ideas, expertise, and legal advice flow freely.





Ever signed a contract without really reading it? Yeah, we’ve all been there. But when it comes to employment contracts, it’s a whole different ballgame. An employment contract isn’t just a piece of paper; it’s your roadmap for your new job, outlining your rights, responsibilities, and everything in between. In this comprehensive guide, we’ll dive into the nitty-gritty of employment contract review, helping you understand what to look for and why it matters. So, buckle up and let’s get started!

What is an Employment Contract?

An employment contract is a formal agreement between an employer and an employee. It lays out the terms and conditions of employment, including duties, responsibilities, salary, benefits, and more. Think of it as the foundation of your professional relationship with your employer. This document is crucial because it protects both parties by clearly defining expectations and obligations.

Why is Reviewing Your Employment Contract Important?

Reviewing your employment contract before signing is essential for several reasons:

  • Clarity and Understanding: It ensures you fully understand your role, compensation, and benefits.
  • Legal Protection: It protects your rights and outlines the legal obligations of both parties.
  • Avoiding Disputes: A well-drafted contract can prevent misunderstandings and disputes down the line.

Key Elements of an Employment Contract

When reviewing an employment contract, there are several key elements you should pay close attention to:

1. Job Title and Description

Ensure the job title and description accurately reflect the role you agreed to. This section should outline your duties, responsibilities, and who you report to. If it’s vague or overly broad, ask for clarification.

2. Compensation and Benefits

This is the section everyone looks at first – and for good reason. It should detail your salary, payment schedule, bonuses, and any other financial compensation. Additionally, review the benefits package, including health insurance, retirement plans, and other perks.

3. Work Hours and Location

Check the work hours, location, and any remote work policies. Are you expected to work overtime? Is there flexibility in your schedule? Make sure these details align with your expectations and lifestyle.

4. Probationary Period

Many contracts include a probationary period, during which either party can terminate the employment with minimal notice. Understand the length of this period and the conditions that apply.

5. Confidentiality and Non-Disclosure Agreements (NDAs)

Confidentiality clauses and NDAs are common in employment contracts. These clauses protect the company’s sensitive information and intellectual property. Make sure you understand what you’re agreeing to keep confidential and for how long.

6. Non-Compete and Non-Solicitation Clauses

Non-compete clauses restrict your ability to work for competitors or start a similar business for a specified period after leaving the company. Non-solicitation clauses prevent you from poaching clients or employees. These clauses can significantly impact your career, so review them carefully.

7. Termination Conditions

This section outlines the circumstances under which the contract can be terminated by either party. It should cover notice periods, severance pay, and any conditions that must be met for termination. Knowing your rights in case of termination is crucial.

8. Dispute Resolution

Employment contracts often include a dispute resolution clause, detailing how conflicts will be resolved. This might involve mediation, arbitration, or legal action. Understanding this process can save you headaches if a dispute arises.

Common Pitfalls to Avoid

When reviewing your employment contract, keep an eye out for these common pitfalls:

  • Ambiguous Language: Vague terms can lead to misunderstandings. Ensure everything is clearly defined.
  • Unreasonable Clauses: Be wary of clauses that seem overly restrictive or unfair.
  • Hidden Costs: Watch for clauses that could result in unexpected expenses, such as training costs if you leave the company early.

Tips for Effective Employment Contract Review

Reviewing an employment contract can be daunting, but these tips can help you navigate the process like a pro:

1. Take Your Time

Don’t rush through the review process. Take your time to read and understand every section. If you’re unsure about something, seek clarification.

2. Seek Professional Advice

Consider consulting a lawyer, especially if the contract contains complex legal jargon or restrictive clauses. A legal expert can provide valuable insights and ensure your interests are protected.

3. Ask Questions

Don’t hesitate to ask questions. If something isn’t clear, get clarification from your employer or HR department. It’s better to address concerns upfront than to face issues later.

4. Compare with Industry Standards

Research industry standards for compensation, benefits, and other contract terms. This can help you determine if the offer is competitive and fair.

5. Negotiate

Remember, contracts are negotiable. If you find terms that are unfavorable, discuss them with your employer. Negotiation is a normal part of the process, and it shows that you are thorough and professional.


What should I do if I don’t understand a section of the contract?

If you encounter a section that you don’t understand, seek clarification from your employer or HR department. If you’re still unsure, consider consulting a lawyer for professional advice.

Can I negotiate terms in the employment contract?

Absolutely! Most employers expect some level of negotiation. If you find terms that are unfavorable or don’t align with your expectations, discuss them with your employer.

What happens if I sign an employment contract without reading it thoroughly?

Signing a contract without reading it thoroughly can lead to misunderstandings and potential legal issues down the line. It’s crucial to review and understand all terms before signing.

How can I tell if a non-compete clause is reasonable?

A reasonable non-compete clause should be limited in scope, duration, and geographic area. If a clause seems overly restrictive, it may not be enforceable. Consult a lawyer if you’re unsure.

What should I do if I find an unreasonable clause in the contract?

If you find a clause that seems unreasonable, discuss it with your employer. They may be willing to modify or remove it. If not, consult a lawyer to understand your options.


An employment contract is a critical document that defines your professional relationship with your employer. Taking the time to review and understand it thoroughly can save you from potential disputes and ensure your rights are protected. Remember to take your time, seek professional advice if needed, and don’t hesitate to negotiate terms. By following these guidelines, you can enter your new job with confidence and peace of mind.

Authoritative Links

For more information on employment contract review, check out these resources:


By reviewing your employment contract carefully and understanding each clause, you can ensure a smooth and successful start to your new job. Happy reading, and best of luck in your new role!