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10 common provisions in employment contracts

Every employment contract will be different, but there are certain common provisions that you'll see again and again. Employees and employers alike should familiarize themselves with the following provisions and what they mean.

Confidentiality agreement: These clauses prevent employees from sharing company trade secrets and other confidential information and intellectual property.

Noncompete agreement: These limit an employee's ability to compete with the company while employed and for a period of time after employment.

Ownership of inventions agreement: If an employee invents something within the course and slope of his or her employment, this provision could ensure that the company will own the invention.

Best efforts agreement: These provisions ensure that employees will do the best job that they can.

Exclusive employment agreement: This prevents employees from working in the same or similar capacity for another company in the same business.

No additional compensation agreement: This prevents employees from getting more money for serving on a managing committee or as an elected officer or director of the company.

No authority to contract agreement: This means that the employee cannot enter into a contract on behalf of or as an agent of the company.

Termination agreement: This offers guidelines for terminating the employment contract.

Arbitration agreement: Arbitration clauses require employees and employers to arbitrate any disputes related to the contract instead of going to court to resolve them.

Choice of law agreement: These indicate in which state any employment disputes shall be litigated.

Does your employment agreement have any of the above provisions? Is there another kind of provision contained in your agreement that you don't understand? Whether you're an employer or an employee, make sure that you completely understand the legal implications of any employment agreement and all the provisions it contains before you sign the document.

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