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Contract Employment Arrangements

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What is a Contract Employment Arrangement?

A contract employment arrangement is a type of work agreement, usually for a temporary or short-term project.  Contract employment is usually done according to very specific contract terms.   This is because the employee is typically not a regular worker, but an independent contractor or other such specialist. 

As such, the contract used may not be a standard employment contract that is used for the company’s regular hires, but rather a specific one drafted for the temporary job.  The temporary worker is usually called an independent contractor, temporary work, or contract laborer.  Some examples of contract employment arrangements may include:

  • Various construction projects
  • Short-term projects specific to business sales goals
  • Product-specific marketing campaigns
  • Investigative committees and other ad hoc type committees
  • Employees involved in short joint-venture projects between companies

What is Usually Contained in a Contract Employment Agreement?

Contract employment arrangements should be governed by a formal written agreement between the employer and the worker(s).  The terms of the agreement may include:

  • Terms for payment (i.e., how much is to be paid, how regularly payments are to be made, etc.)
  • How long the arrangement will last, and under which conditions the employment may be terminated
  • Whether the worker will be entitled to receive benefits such as insurance coverage, pay bonuses, etc.

Contract employment arrangements may be made by the company itself, through its hiring or human resources department.  However, in many cases, an agency may fill the company’s hiring needs by providing temporary workers who fit the descriptions of the contract employment terms. 

What if There is a Dispute Over the Contract Terms?

In a temporary employment arrangement, the contract terms should be very specific and clear.  They should not contain any ambiguous statements or terms that might lead to confusion.  In order to achieve a clear and understandable agreement, it may be necessary for the parties to individually hire lawyers who can help with the negotiation stages.

In the event that there is a dispute over the contract terms, the parties may need to submit the contract to the court for review.  The court will then analyze the contract to determine whether it is fair to both parties, and whether any breach of contract has occurred.  In a contract employment arrangement, disputes commonly arise with regards to either payment for the labor, or with the quality and completeness of the labor provided. 

What are Some Remedies Involved in a Contract Employment Lawsuit?

Remedies for a breach of an employment arrangement can result in monetary damages for the non-breaching party, or an equitable remedy (such as reinstatement back to the work position if they were wrongfully fired). 

If the laborer or worker has breached the contract, they may be required to reimburse the company employer if they have caused them any losses.  A common example of this is where a construction company does not finish a building job in the correct time frame.  Such delays may cost the business some profit, in which case the construction company may need to pay the corresponding amount in damages.

Do I Need a Lawyer for Help With Contract Employment Arrangements?

Contract employment is a very specific subset of employment law.  If you need assistance negotiating or reviewing an employment contract, you may wish to contact an experienced employment lawyer in your area.  Your attorney can help you with the initial stages of the agreement process, and can also represent you in court if you need to file a civil lawsuit. 

Photo of page author Ken LaMance

, LegalMatch Law Library Managing Editor and Attorney at Law

Last Modified: 05-07-2018 12:19 AM PDT

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