Know your rights: Employment contracts

You’ve just received the call you’ve been waiting for – the job is yours if you want it. Now, you just need to wait for the employment contract to arrive. But what should it include and are there any red flags to look out for? 

An employment contract sets out the terms and conditions of employment. Understanding and signing it can feel overwhelming, especially if you’re new to the workforce, so we’ve asked an employment lawyer about what to look out for. 

Casual, permanent and fixed-term contracts – what’s the difference? 

Andrew Jewell, Principal Lawyer at Jewell Hancock Employment Lawyers, explains that there’s no legal requirement for employers to provide a written employment contract. But, they must give information about pay and entitlements in writing. 

“It is definitely best practice to set our terms and conditions in a considered legal document,” he says. 

Casual, permanent and fixed-term roles require different employment contracts. 

Jewell says that casual contracts generally involve an ad hoc engagement where hours and pay change from week to week, but they have a set hourly rate. They also have short termination periods, which can be as little as a day. 

“Permanent employment contracts are the most common and involve an ongoing employment relationship, usually subject to a probationary period and right of termination, but otherwise for set hours – full-time or part-time – and a set rate of pay,” says Jewell. 

Fixed-term contracts are similar to permanent contracts, but they have a specific end date. They might apply if you’re employed to cover someone’s parental leave, for example, or to work on a specific project of a set duration. From 6 December 2023, a fixed-term contract can’t be for longer than two years. This includes any extensions or renewals. 

“They generally cannot be ended by either party before the end date,” says Jewell. “If there is a right of termination, then they are ‘maximum term contracts’.” 

What must be included in an employment contract? 

If you’ve just received your employment contract, it’s wise to check it carefully to make sure it includes the following mandatory elements: 

• rates of pay  
• hours of work 
• any allowances or loadings 
• information about entitlements, such as leave 
• rights and processes involving dismissal or resignation. 

While they aren't mandatory inclusions, Jewell says some other terms to look out for might include: 

• duties 
• expectations 
• obligations regarding performance and conduct 
• future increases in pay  
• obligations after employment, such as regarding confidential information. 

Red flags to look out for 

When you receive your employment contract, it’s worth checking more than the wage, hours and leave clauses.   

Carefully review the entire contract to make sure you’re comfortable with and understand its terms. If there’s anything missing or that’s unclear, such as the length of your notice period, consider calling or emailing the employer to ask for clarification. 

“Any terms that are vague or uncertain, or appear to be unfairly one-sided, such as overly restrictive post-employment obligations, might cause a job seeker to seek clarity from the employer or seek legal advice,” says Jewell. 

Can you amend an employment contract before signing it? 

If you aren't happy with all the elements of an employment contract, Jewell says you’re entitled to ask for changes. 

“However, any amendments or changes would need to be agreed by the employer to take effect,” he says.   

While the employer doesn't have to agree to these changes, it’s important to know that you don’t have to agree to the employment contract. But you may not be able to start work at some organisations without signing one. 

Where can you go for help? 

If you have any questions about an employment contract before you sign it, Jewell suggests seeking legal advice from an employment lawyer. 

The Fair Work Ombudsman website also includes information about employment contracts and legal minimum requirements.  

Employment contracts can be a daunting part of landing a new job, especially if it’s your first job. But, while they vary depending on whether you’re starting a casual, permanent or fixed-term role, they all have legal requirements that need to be included. So, be sure to read your employment contract thoroughly before you sign on the dotted line.