Many organisations currently use a standard employment contract and staff handbook. These types of contracts and regulations always contain many rules and obligations. The advantage of these types of contracts is that many situations are legally sealed. The disadvantage is that sometimes the documents and the obligations arising from them do not match an organisation's vision and mission at all. For example, if the organisation tells during job interviews that they consider flexibility, independence, ambition and passion to be very important, but then comes up with a very long contract where the employee is bound by numerous obligations. Then this contract is not a good reflection of the organisation and may even deter applicants.
To prevent internal contracts and policies from putting off potential employees, more and more companies are ensuring that the contracts and policies they use within the organisation are in keeping with the organisation’s ethos and vision. For example, one organisation might opt for an employment contract presented as an infographic, whilst another might choose a ‘standard’ employment contract, but written in simple, easy-to-understand language.
A common criticism of contracts written in simple, accessible language is that they are less legally watertight. This is a valid concern. However, in practice, the impact is not as significant as one might think, as standard legal clauses are replaced by comprehensible provisions that are specifically tailored to the organisation. For example, a detailed clause protecting the employer’s intellectual property may be necessary for a software developer, but this clause could be considerably shorter – or even omitted entirely – in an accountant’s employment contract. And, for example, do you often deal with employees who continue to carry out the same work after their employment has ended, but on their own account? In that case, it may well be advisable to agree, in addition to a standard non-competition clause, that an employee may not set up their own competing business after their employment has ended.
To give an idea of the differences between two styles of writing, I hereby provide an example of a standard non-competition clause and a non-competition clause in Jip-and-Jane language.
Example of a standard non-competition clause
– The Employee is prohibited, for a period of one year following the termination of this employment contract (regardless of the manner in which and the reasons why the employment contract came to an end), to work, either directly or indirectly, within a radius of 50 kilometres from the Employer’s place of business, for themselves or for others, in any capacity whatsoever, for a company or organisation engaged in activities in a field that is the same as or otherwise competitive with that of the Employer.
Example of a non-competition clause in simple terms
– We believe it is important for you to gain a great deal of knowledge and experience within our company. However, we also wish to protect our business interests. We therefore agree with you that, during your employment and for 12 months thereafter, you will not carry out any work for a competitor of ours in the Netherlands.
These are two examples of how a non-competition clause can be worded. In addition to these two options, there are, of course, a thousand other variations to consider. When amending employment contracts, it is therefore particularly important that the contract is tailored to the organisation.
We are also seeing a trend towards adapting the traditional staff handbook into one with a more promotional character. In this way, an increasing number of companies are seeking to attract professionals and retain staff. In particular, offering flexible terms and conditions of employment is proving popular.
For example, adjusting the fixed public holiday policy. More and more employees want to choose which public holidays they take off. For instance, one employee may not care about Ascension Day, but would prefer to have Liberation Day off every year. In companies that already have a flexible public holiday policy, employees are given the choice to swap two official national public holidays for public holidays they would rather celebrate.
Employers are also drawing up new agreements on other topics: working from home, remuneration, flexible holiday entitlement and working hours. New rules on the use of social media, health and safety, and inappropriate behaviour are also being added to staff handbooks these days. Which topics are relevant or feasible within an organisation naturally varies from company to company. If an organisation wishes to change its terms and conditions of employment, it is therefore advisable to first assess which conditions and arrangements are desirable and which are not.
After reading this article, have you come to the conclusion that your standard contracts are in need of an update? Or have you been working with HR for some time to make this move and want to have the documents you have drafted legally reviewed? If so, give us a call. We will be happy to think with you about which style/options best suit your organisation.