Employment Contract

Several wiki pages about hiring/firing/quitting refer to "employment contracts". What are typical terms of employment contracts?

intellectual property ownership We own anything you think of.
prohibitions on moonlighting We own your whole life.
terms under which employment may be terminated We can dismiss you at any time.
non-compete after termination After we dismiss you, we still own you.

What should prospective employees look for when evaluating one?

Some companies demand that employees make explicit promises that they are working in the best interest of the company. Some examples of "loyalty oaths" are

OverlyBroadIntellectualPropertyAgreements and NonDisclosureAgreements
agreements to not do any work for anyone other than the employer
agreements that after leaving the company, the terminated employee will not compete with the former employer
SigningUp
promises not to steal from the company or to use company resources for personal use
promises about lengths of coffee breaks, lunch breaks, use of the break room, etc.
acknowledgement that one has read the company's "statement of principles", "vision statement", "code of ethics", or other such documents

While such oaths may be necessary in some cases to limit the company's liabilities or to make expectations clear, they are almost universally seen as insulting by the people who have to sign them.

Most employees want to make a genuine effort to act ethically toward their employers, but being asked for an explicit promise to do so is an indication that the employer does not AssumeGoodFaith from the employees. In such cases, the employees should not AssumeGoodFaith from the employer. Employers who demand loyalty oaths from employees rarely demonstrate any reciprocal loyalty.

When an employer institutes a new LoyaltyOath?, watch out! Such oaths are often immediately followed by additional demands on employees (longer working hours, reductions in pay or benefits, etc.), or terminations of those "disloyal" employees who refuse, who complain, or who act in a manner somehow inconsistent with the terms of the oath.

Guys, it's even worse in other fields. Apparently, your regular medical contracts have things along the lines of:

You can't quit for a year.
You have to give 6 months notice before you can quit.
They restrict your ability to search for a job.
They can fire you at any time
If you quit, you instantly lose the protection of their malpractice insurance and can be sued for millions
Other nice things that I've forgotten...

On the other hand, I have minimal employment contracts at my current place of employment. But I think it's mostly because very few people actually quit, and that's when most of the clauses of the employment contracts kick in.

I have noticed that the biggest problem with most employment contracts I've seen is OverlyBroadIntellectualPropertyAgreements.

I think that it is reasonable to give up the right to any inventions you have with employer resources. The best contracts are equitable - if you need to give them 2 weeks notice to quit, they need to give you 2 weeks to fire you. I've never seen such equitable contracts, however.

Many times they state that you can't disclose any of the proprietary information you have acquired while working for the company. You may also be restricted from directly doing business with the clients of the customer - i.e. you build the relationships with the clients, then quit and start a new company with your relationships that you've developed. Sometimes there's a no-compete clause.

They often say that they won't enforce it, that it's just there to protect them, etc. Then why is it in your contract for the first place?

The best way to deal with these contracts is to get a lawyer. To have them work over a contract is actually pretty easy, much cheaper than suing somebody and definitely a cost-effective way to avoid later problems. Generally they also know the best way of getting the contract changed without going through the company legal department, who are programmed to screw people as hard as possible.

Note: this is presumably all about US contracts. In the UK, we have more legal rights than this -- e.g there's a prohibition on "restraint of trade" which prevents the more over the top non-compete clauses, and also (it seems) "common practice" is to have less draconican contracts anyway

For a refreshing version of an EmploymentContract, check out: http://www.simplerwork.com/contract.htm

See OverlyBroadIntellectualPropertyAgreements.