Scope of Employment
It is important to enumerate the duties that the employee will be responsible for. 💡 Can you think of both legal and business reasons why?
As such, the company needs to include the title and the employee’s responsibilities in the employment contract. A drafter should think about potential scenarios and how the contract addresses them. For instance, if the executive does not perform, then what? Demotion? Modify the responsibilities? Breach of contract and termination for cause? Providing the answers to these possibilities is important. One doesn’t want a judge or jury to interpret what we meant.
If the employee is full time and upper management, it is almost always expected that the employee will devote substantially all of their business time and efforts to satisfying the responsibilities provided in the contract. However, we don’t want to assume do we? There should be a “time and efforts” clause in the contract. Does the T&E clause mean that the employee is disallowed from other activities (eg. serving as a board member at another company, etc.)?