There are so many details that go into running a restaurant whether you’ve joined in as a franchise owner or you’re starting your restaurant from scratch. One of the best ways to protect your business and your employees is to create an employment contract for restaurant staff!
Employee contracts are an easy way to outline exactly what compensation would be and how their work environment will be run. Any confidential information can be secured at this stage and you’ll be ready to take on the world with your business. If you need help to create a contract, contact an executive employment attorney for help.
Restaurant Jobs that May have An Employment Contract
Not every job will require employees to sign an employment contract or require you to offer one. An employment contract is the way that employers set out for their new employees the way the job is going to look.
A restaurant employment agreement is one of the best ways for an employer to control the way an employee ends up leaving their business. If you’re in a high end or very specific industry where losing or trading an employee might end up costing you quite a bit of money, there’s a good chance you’ll want to invest in an agreement.
There’s a good chance you’ll end up with an agreement if you’re salaried while at the restaurant, make key business decisions on a regular basis, or know sensitive information about the overall restaurant. These are typically high level positions like a district or regional manager, executive chef, or a bar manager that are a good fit for the business.
Offer letters are not considered legally binding like a restaurant employment contract and will likely have a full job description that correlates to the restaurant industry where you’re being hired.
Clauses to Include in your Restaurant Employment Contract
Since a restaurant employment agreement is legally binding, there are several things you’ll want to be sure to include. A great way to start is with an employment contract template!
Employment Status Clause
This is an important piece of information for both employer and employee to posses in a legally binding, contract form: your status within the restaurant. This is often part of the job description but it delineates who will fill which roles from executive chef to part-time barbacks. A restaurant manager employment contract is specific and pointed about the job description as well.
Not everyone needs to be full-time so your employment contract agreement spells out the terms of employment including working hours, terms and conditions of employment, and how the employee will be paid.
Compensation Clause
This is the restaurant employee’s bread and butter and tells you exactly how much you’ll be paid for your work! In addition to pay, you’ll also need to spell out any benefits and compensation you’ll have on hand for your employees in this clause.
The terms of employment in each employment contract is going to be different depending on your contract. So while you’ll start with a template, you’ll need to be sure you adapt it and the terms of employment for each employee you plan to hire. After all, your part-time employees won’t need the same PTO as your executive chef.
Termination Pay Clause
This is where things can begin to differ from restaurant to restaurant and where you might want to really consult your legal counsel. Your lawyer will be able to accurately tell you if an employee needs to get termination pay if they’re fired by you.
Each state is different in how it handles termination pay but your lawyer can advise you on what you’ll need to include in your contract. This will clearly state what each employee is entitled to if they should be fired!
Non-Compete, Non-Solicitation, Non-Disclosure Clause
From time to time, you’ll need to be able to ensure your employees are representing your company and putting in effort just for your company. The first part of this is a non-compete agreement or clause and it will prevent your employees from leaving to work for a competitor within a certain time frame.
Non-solicitation clauses keep your employees in place as one can’t leave and take the others with them. And lastly, a non-disclosure clause prevents employees from sharing confidential information with anyone else once they leave the company.
Intellectual Property Rights Clause
Employees at your restaurant take on additional duties or be hired in positions other than front-of-house. A social media manager, graphic designer, or public relations will be dealing with intellectual property and an intellectual property rights clause protects you as the employer from them using your designs on other projects.
This clause needs to be specific in that you as the employer owns all the intellectual property!
Advantages and Disadvantages of an Employment Agreement
Just like anything in the restaurant industry, there are risks involved with an employment agreement! Depending on the industry and type of restaurant you own there are some unique advantages and disadvantages of an agreement for your employees.
The first advantage of an employment agreement is that it specifies the specific length of employment for an employee. Everything from start date to end date is lined out in an employment agreement so everyone is on the same page. An employee’s salary, fringe benefits, and promotion schedule are in this agreement making it easy to put down any arguments or find answers when needed.
Since an employment agreement is legally binding, the biggest disadvantage is that if a clause or provision needs to be changed, both parties need to work together to get the job done. Implicit in an employment agreement is that both parties are going to work in good faith. If one or both parties act dishonestly, they can be sued by the other under the contract itself.
Conclusion
Depending on your restaurant, putting an employment contract in place can be a great way to protect yourself. Each one needs to be unique but can be started from a template to make it simple!
