PeopleGoal

Contract of service

A contract of service is a formal, legally binding agreement between an employer and an employee. It is also known as an employment contract. It defines the employer-employee relationship, and must include certain terms and essential clauses.

All permanent employees must have a contract of service with their employer. It sets out an employee's terms of contract, including their employment conditions, rights, responsibilities and duties.

A contract of service must include:

  1. Full name of employer
  2. Full name of employee
  3. Job title, main duties and responsibilities
  4. Job title, main duties and responsibilities
  5. Start date of employment
  6. Duration of employment
  7. Working arrangements, such as: daily working hours, number of working days per week, rest days
  8. Salary period
  9. Basic salary
  10. Fixed allowances
  11. Fixed deductions
  12. Overtime payment period
  13. Overtime rate of pay
  14. Other salary-related components, like bonuses and incentives
  15. Type of leave, like annual leave, outpatient sick leave, hospitalisation leave, maternity leave, childcare leave
  16. Other medical benefits, like insurance, medical benefits, dental benefits
  17. Probation period
  18. Notice period
  19. Place of work
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