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When should I have written employee contracts?

At your Texas business, you have the option to terminate employees at will, as long as your decision is not based on discrimination, retaliation or some other illegal reason. Your employees also have the right to leave the job at any time.

In many cases, it is worthwhile to employers to take steps to keep their employees from walking away from the company.

When you need a strong employer/employee relationship

As FindLaw points out, education, training and specialization can make an employee valuable. Once you have invested the time and effort into finding and preparing someone to fulfill particular duties within your company, losing that person to another company can set you back months. If you have created a solid contractual relationship with your employee, the risk that he or she will leave at will is minimal.

The contract benefits your employee as well, limiting the reasons you can end the employment relationship. If losing the ability to terminate the employee at will is an issue, you may not want to have him or her sign a written contract.

When you have intellectual property to protect

Most companies have some intellectual property that gives them an edge in the market. If you have employees who have access to this private information, you may need to do something to keep them from leaving and sharing the information with another company or starting a company and using the information to compete with you. Clauses such as a nondisclosure agreement and a noncompete agreement can ensure that your employees will not steal your trade secrets and damage your business.

These factors are just two of many to consider before drafting contracts and signing on the dotted line; therefore, this information should not be taken as legal advice.

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Cortez Law Firm, PLLC
12801 N Central Expy #360
Dallas, TX 75243

Phone: 214-380-4030
Fax: 214-919-4209
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