Things to Ask When Signing an Employment Contract

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Things to Ask When Signing an Employment Contract

There was a time where people clamored for any jobs they could get. The job market was restricted, and work was myriad. But each type of work required certain skills, and unskilled workers were paid limited remuneration. Eventually, people acquired loyalty towards their work, and they stayed for a long time. Now, that is changing. New types of jobs are emerging, and different skills are in demand. Things that people could not have thought of as job opportunities turn out to be more viable than traditional job opportunities. Each such job opportunity requires specific skills and the demand for unskilled people is falling.

Even as different sectors are looking for different skills in employees, there’s a shift towards a more employee-centric structure happening. Previously, the rates that employees are offered for a role would remain at a standard rate irrespective of their skill level. Now, skills are being recognized, and remuneration is starting to be commensurate with that. Employees now have some skills level to their credit. They are in a position to bargain for the role that they are vying. Companies know exactly the skills that expect for the role, and they know the employees that they would interview for the position(1).

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As an employee, when you have a job offer, you can’t accept it right away. Employers look to get the best they can by giving back as little as possible. Some organizational cultures focus on giving the right recognition for employee skills and contributions. Others believe in providing monetary remuneration and a bare few other benefits. The remuneration might be on par with the entire industry. However, the way companies approach employee contracts speaks a lot about organizational culture. As an employee, you need to look for companies with a proven culture that favors the employees. 

So, before you sign that employment contract, here are some things, you need to keep in mind.


This is probably the first no-brainer item on this checklist. You need to ask the details about your salary and other elements that come as part of your compensation package. Your compensation doesn’t mean your salary. The benefits that you will receive are usually some percentage of your base salary. Employers generally keep your base salary at a minimum while offering you a lot of other benefits in your compensation package. The point of a compensation package is to understand how your compensation is split. This split is also helpful in the case of taxation. Some elements of compensation incur more taxation than others

When you have a conversation with the human resources personnel, you can always discuss your salary breakup. For many roles, this is fixed, and they won’t allow negotiation. But, in case they do allow, you should always negotiate your compensation. Discuss with them whether the salary is negotiable or not. Discuss the components of your salary. Remember, the higher your base salary, the better it will always be for your other benefits that the compensation will allow.

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Other Benefits

Always ask what other benefits are part of your entire compensation. Beyond monetary benefits, you need some things that the organization should provide for you. These include medical insurance, dental care, vision insurance, etc. Apart from this, there are other things that your job should allow you, such as 401(k) and other forms of provident funds and pension schemes. There’s nothing wrong with a company that doesn’t provide all this. If you can manage to find a company that offers lesser monetary compensation but higher benefits, that would be advantageous for you.

The simple reason for this is that medical insurance can be highly expensive. Having to shoulder that expense on yourself can create a large enough dent in your financials. In general, it is always better if your company offers you some benefits. That way, you can shoulder the financial burden of the benefits for which your company doesn’t pay. Contributions to 401(k) can be restrictive when you have to provide it for your own. Instead of taking that burden, it is always beneficial if your company does it for you. 

Vacation Policy

Vacation policy is an important thing that you have to ask about. Some companies offer to leave but on an unpaid basis. Others do the same but have a restriction on how many unpaid days off you can take. Every day that you take beyond that counts as leave without permission. Companies take unapproved leaves very seriously. They have a policy where, if the unapproved leaves cross a number, that is grounds for termination. Ideally, companies should provide vacation days. This vacation is usually of three types — statutory leave earned vacation and sick leaves. Statutory holidays are those that the government has declared holidays. Companies need not have all the holidays that a government has declared as holidays.

However, it is important to select some depending on the demographic and geographic location of the company. There will always be some days taken more seriously as festivals or important days than others. For example, Day of the Dead is important in some parts of Mexico, while Christmas is more important in America. This doesn’t mean that the same holidays aren’t important in other countries. It depends on where the company is in the country and what they consider most important. 

Culture of the Organization

This is less of asking the employers and more of doing your research. All companies boast on their website that they have an inclusive culture, and they respect everyone. All companies speak of a specific number of values as if that list is what every company should have. They have landing pages dedicated to inclusivity, and some have pictures of the team who look like they are having fun. In some cases, that is true. The team was having fun. But that was just an opportune thing that the organization decided to use. That might not reflect the culture across the organization.

-There are several instances where the organization would purport to spread inclusivity, but the team you’ll have to work with can be a nightmare. One could argue that it does not represent the entire organization. True, but you’re not concerned about the entire organization. You are concerned about the team you have to work with. The other question that comes up in this discussion is how one can know from asking questions to the employer. The truth is, you can’t. The way they discuss the team and what they do speaks volumes about what the team is really like. 

Another thing that you can do is to read reviews about the organization online. There are several websites like Glassdoor that offer reviews from current and past employees about how the organization is and what is to be expected from the organization. You should remember that you can’t always trust these reviews. You have to take them well salted. There have been instances where the company has forced its employees to write favorable reviews online to boost its online presence. Besides, if it is a service-oriented company, the reviews on platforms like Google will be about the service and not necessarily about the culture. Since you’re joining to stay there for quite some time, you need to spend some time researching it.

Professional Growth

Education is an important part of every job. Even though you came to the job prepared, you can’t become complacent because you bring a wealth of knowledge and experience. Each role in each organization offers its own set of challenges. Experiencing them firsthand is important to gain enough knowledge. Even beyond that, as the regulatory framework changes and technology improves, today’s experience can become obsolete tomorrow. You need to upskill yourself to stay relevant constantly. Most companies realize this and offer several training programs for their employees so that they can upskill themselves. When you’re joining a company, you need to ask details about this because it shows how much the company invests in its employees.

Bottom Line

As discussed above, you need companies that focus on their employees. Several companies have programs where they offer a degree or a diploma with some well-known university. They have tie-ups with several reputed training providers to offer courses in various subjects that will bear relevance to the role. This is one way that companies can ensure long-term employees because they are grateful for their help, and want to give back. Some companies will pay for a portion of tuition, and some even allow you to take a leave of absence to get your degree. The more education you have, the more you will have to offer your employer, and they often recognize this and will help.