For anyone who is currently living in the U.S. and is looking to invest in or start a business or anyone who currently lives abroad and is considering investing in or opening a business in the US, it is important to learn more about how employment contracts work in this country.
While different employment contracts can vary considerably depending upon the specific role for which an employee is being hired, as well as the type of business doing the hiring, there are common elements to U.S. employment contracts.
Here, I explain the variation from one U.S. employment contract to another, as well as to say more about what elements often are included in an employment contract USA.
Not All Employment in the USA Requires a Contract
The first thing to know is that there are no wide-ranging laws that govern employment contracts in Florida or in the U.S. more generally.
In fact, there is no requirement under U.S. law that an employee has a written contract whenever there is an employer-employee relationship.
In the US, many employees are what are known as “at-will” employees, which means that their employment is not governed by a work contract USA or another type of employment agreement. Rather, at-will employment means that either the employer or the employee can terminate the employment at any time and without cause. Even if an employee in the U.S. gets an offer letter, it is important to know that an offer letter is not the same thing as an employment contract.
Typically, however, professionals and highly skilled employees in the U.S. will have an employment contract.
Variation in U.S. Employment Contracts
Even when employees are highly skilled or working in professional positions in which employment contracts are common, there is great variation in the types of employment contracts in the USA that can exist.
Examples of some of the ways in which employment contracts vary include but are not limited to:
- Term of the employment contract: there is no specific employment law requirement that an employment contract be for a particular period of time. Some employment contracts have fixed terms, while others are open-ended in terms of the employment term. These variations can even exist within the same profession.
- Trial period: some employers have a trial period for new employees, while others do not. For most employers who require a trial period—also known as a probationary period or an introductory period of employment—the employee typically will receive a review after a specified period of time.
- Notice requirement: employment contracts may or may not include a notice requirement, meaning the amount of time an employer must give when terminating an employee.
Common Employment Contract Sections
While employment contracts in the U.S. do vary widely, they frequently have similar sections, including but not limited to:
- Employee’s responsibilities;
- Compensation;
- Benefits;
- Methods of dispute resolution;
- Nondisclosure and/or confidentiality agreements;
- Non-compete clauses; and
- Termination information.
Differences Between U.S. and European Employment Contracts
The main differences between U.S. and European employment contracts are vacation days, sick days, and maternity leave. For U.S. employees it is common to have only 10 vacation days plus some holidays per year and maybe 7 paid sick days (longer periods apply under the Family Medical Leave Act). Paid maternity leave extends only 6 weeks after birth. In Europe, all of these periods are considerably longer and governed by law.
Get Help With Your USA Employment Contract
If you have questions about U.S. employment contracts, you should get in touch with an international business law attorney who has experience with businesses in the U.S. and in Europe.
Contact me today for more information.
Timo Becker
Timo Becker works with U.S. business owners throughout America and overseas, and he also assists people from German-speaking countries looking to invest or start a business in the United States.
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