Being offered a new job is exciting, but before you jump in, it’s essential to fully understand the terms of your employment. Your employment contract is a legally binding document that sets out your rights and obligations, so reviewing it carefully is crucial.
Here are some key things you should understand about your employment contract to ensure you’re fully informed and protected.
1. What is my job title and what are my responsibilities?
You want to be sure that your contract accurately reflects your role. Vague job titles or responsibilities can lead to confusion about what is expected of you. Ask for specific details about:
Your job title.
The core tasks and duties you will be responsible for.
Any additional responsibilities that may fall outside of the standard job description.
Why is this important? You don’t want to find yourself doing tasks far beyond your scope without proper recognition or compensation. Understanding your role will help you set clear expectations for yourself and your employer.
2. What is the notice period for resignation or termination?
Your contract should clearly outline the notice period if either party wishes to end the employment relationship. It’s common for notice periods to range from two weeks to a month to 3 months, but this can vary depending on the industry and seniority. Check your contract for:
How much notice do you need to give if you want to resign?
What notice will you receive if you are made redundant or dismissed?
Are there any circumstances where the notice period might differ, such as during a probation period or 90 day trial?
Why is this important? Understanding the notice period will give you peace of mind if you decide to leave or if your role is unexpectedly terminated. Shorter or no notice periods might leave you in a vulnerable position.
3. What is the rate of pay, and how is it structured?
Pay details are fundamental. Your contract should state your salary or hourly rate, how often you’ll be paid, and whether there are any conditions tied to bonuses or commissions. Ensure that you fully understand:
The base salary or hourly wage.
The frequency of payments (weekly, fortnightly, or monthly).
Any entitlement to bonuses, commission, or overtime.
Deductions that may be made (e.g., KiwiSaver contributions).
Why is this important? Clarifying your pay ensures there are no surprises, especially around bonuses, commission structures, or tax deductions.
4. What are the working hours and flexibility options?
Standard working hours can vary between industries, and it’s important that these are clearly outlined in your contract. Get a clear understanding of:
The expected number of hours per week and how hours are allocated i.e. rosters.
Start and finish times, and whether flexibility is an option.
Whether overtime is expected, and if so, how it’s compensated.
Whether you’ll have the opportunity to work from home or adjust hours to suit personal commitments.
Why is this important? Understanding your working hours ensures you know what is expected of you. You should also know whether overtime is voluntary or mandatory and how it affects your pay.
5. What are the leave entitlements?
Every employee in New Zealand is entitled to certain types of leave, such as annual leave, sick leave, and public holidays. Make sure your contract spells these out, and ask questions like:
How many days of annual leave am I entitled to?
Are there any extra company holidays or days off?
What is the policy for sick leave or bereavement leave?
Can I carry over unused leave, or is it use-it-or-lose-it?
Why is this important? Knowing your leave entitlements ensures you can take breaks when needed without worrying about losing pay or taking leave without approval.
6. Is there a probation period or 90 day trial?
Many employers include a probation period in their contracts. This is a trial period during which either party can terminate the contract with shorter notice or without the usual employment protections. Check your contract for details of probation or trial periods such as:
How long is the probation period?
What criteria will be used to assess my performance?
What are my rights if I am let go during probation?
Why is this important? Probation periods and 90 day trials can leave you with fewer protections than a permanent employee. Understanding the terms and the criteria for passing probation can give you a clearer sense of security in the early stages of your employment.
7. Are there any restraints of trade or confidentiality clauses?
Some contracts include post-employment restrictions, such as a restraint of trade or a confidentiality agreement, that may limit your future job opportunities. Check if your contract includes:
Any restrictions on working for competitors after I leave?
How long do these restrictions last, and in what geographic area?
Does a confidentiality clause extend beyond my employment?
Why is this important? You don’t want to find yourself in a situation where you are unreasonably restricted from working in your industry after leaving the company. Clarifying these clauses can prevent potential legal issues when you move on to another job.
8. What benefits are included?
In addition to salary, some companies offer benefits like KiwiSaver contributions, health insurance, or additional leave. Make sure these benefits are clearly outlined in your contract. Look for:
What benefits are included (e.g., KiwiSaver matching, health insurance, gym memberships)?
Are these benefits conditional (e.g., after passing probation or meeting certain performance targets)?
Are there any additional perks like wellness programs or training opportunities?
Why is this important? Benefits can make a significant difference in your overall compensation package, so it’s important to understand exactly what you’re entitled to.
10. Can I get the contract reviewed?
Finally, it’s always a good idea to ask if you can have time to review the contract or seek advice before signing. Most employers won’t object to this and may even expect it.
Why is this important? This gives you the chance to fully understand the terms of the contract and seek legal advice if necessary. If something feels unclear or unfair, now is the time to raise it.
Asking questions about your employment contract isn't just about understanding the fine print—it's about protecting your rights and setting yourself up for success in your new role. If you feel unsure about any part of the contract, don’t hesitate to ask your employer for clarification or seek independent advice (Mathews Walker.co.nz | 0800 612 355). This is your career, and it’s important to start off on the right foot.
Disclaimer: The information provided in this blog is for general informational purposes only and should not be considered legal advice. While we strive to keep the information accurate and up to date, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained on the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. For specific legal advice tailored to your situation, please contact a qualified legal professional.
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