Starting a new job is exciting — fresh challenges, new colleagues, and the chance to grow your career. But before you sign on the dotted line, it’s crucial to take a close look at what’s actually in your employment contract. Many people skim through the pages, eager to start, but that signature binds you to obligations and expectations that could have serious consequences if misunderstood. Understanding the details now can save you from confusion, frustration, or legal trouble later on.
Understand the Basics First
Your employment contract is more than a formality — it’s a legally binding agreement between you and your employer that sets out your rights, responsibilities, and working conditions. It defines everything from your job title and salary to your leave entitlements and termination conditions.
Before signing, ensure the basics are correct: your name, job title, start date, salary, and hours of work. Even a small error can lead to administrative issues later. Double-check that any verbal promises made during interviews — such as flexible work arrangements, bonuses, or travel reimbursements — are included in writing. If it’s not written down, it’s generally not enforceable.
While many employees assume all contracts are standard, they can vary widely between industries and roles. For senior-level positions or executive employment dismissals, clauses can be far more complex, often involving non-compete restrictions, share options, or extended notice periods.
Clarify Your Job Description
It might sound obvious, but vague or overly broad job descriptions can lead to significant issues later on. Your contract should clearly outline your role, responsibilities, and reporting structure. If it includes phrases like “and any other duties as reasonably required,” clarify what that means in practice. Employers use such wording to maintain flexibility, but it shouldn’t mean you can be assigned tasks far outside your skills or pay grade.
Understanding your duties upfront helps manage expectations on both sides and ensures you’re not later accused of underperformance in areas that weren’t part of your original role. If the description feels unclear, ask for written clarification before signing.
Pay Attention to Probation and Notice Periods
Most employment contracts include a probationary period, often between three to six months. During this time, either party can usually terminate the contract with shorter notice. Make sure you understand how long your probation lasts and what happens if it’s extended or ended early.
The notice period clause is equally important. This outlines how much time either party must give to end the employment relationship. Short notice periods can be risky if you rely on a steady income, while long ones may restrict your ability to move on quickly to another opportunity.
Ideally, both sides should have equal notice obligations, but some employers include longer requirements for staff than for themselves. That imbalance can make it difficult to leave a job if things aren’t working out, so negotiate for fairness if needed.
Review the Pay and Benefits Package
Salary might be the headline figure, but your total compensation includes far more than just the number on your payslip. Review how often you’ll be paid (weekly, fortnightly, or monthly) and whether there are performance reviews or opportunities for pay increases.
Check any benefits — such as superannuation contributions, bonuses, or allowances — and ensure they’re clearly documented. Vague terms like “subject to company discretion” can make bonuses unreliable. If your role involves travel or out-of-hours work, confirm whether expenses or overtime are covered.
For roles offering commission or performance-based pay, ask how it’s calculated and when it’s paid. Misunderstandings here are common sources of disputes, especially when sales cycles or targets are involved.
Look Closely at Leave Entitlements
Annual leave, sick leave, parental leave, and long service leave entitlements are all governed by law, but your contract should spell them out clearly. If the role includes additional perks like paid study leave or extra holidays, make sure those are written in too.
Be cautious of any clause suggesting that “all leave entitlements are included in salary,” as this can be misleading or even non-compliant with Fair Work standards. You should still be accruing leave separately, not having it bundled into your pay.
If you’re moving into a position that offers flexible working arrangements, check how leave interacts with those hours — for example, whether part-time employees accrue entitlements proportionally.
Understand Restraint and Confidentiality Clauses
Many employers include restraint of trade or non-compete clauses designed to stop employees from working for competitors or starting a similar business after leaving. While some of these clauses are reasonable (to protect trade secrets or client relationships), others can be overly broad or restrictive.
Read these sections carefully and ask:
- How long does the restriction last?
- Which industries or companies does it cover?
- Is the geographical scope reasonable?
If the clause prevents you from working in your field for six or twelve months, it could significantly impact your career. Australian courts often look unfavourably on overly restrictive clauses, but it’s best to clarify before signing rather than challenge it later.
Confidentiality clauses are also common. They protect sensitive company information, but make sure you’re not being asked to keep secrets that would prevent you from using your professional experience elsewhere.
Review Termination and Redundancy Conditions
Termination clauses detail how and why your employment may end — either through resignation, redundancy, or dismissal. Make sure you understand your rights if you’re let go, particularly regarding redundancy pay and accrued entitlements.
Some contracts include “termination without cause” provisions, allowing an employer to end employment by providing notice or payment in lieu. This is legal, but you should confirm the specific conditions and notice period.
Also, check whether your contract includes a “gardening leave” clause — where you’re paid during notice but not required to work. It can be beneficial, but ensure it doesn’t limit your ability to start a new role immediately.
Check for Intellectual Property Clauses
If your job involves creating content, designs, code, or other intellectual property, your employer will likely claim ownership of anything produced in the course of your work. This is standard practice, but ensure the clause only applies to work created for the company.
If you have side projects or freelance work, clarify that they remain yours — especially if they’re unrelated to your main job. You don’t want your employer claiming ownership of personal creative efforts developed in your own time.
Don’t Overlook Dispute Resolution Clauses
Contracts often include a section outlining how workplace disputes should be resolved. This might involve mediation, internal review, or arbitration before any legal action can be taken. While these processes can be helpful, make sure they don’t unfairly restrict your access to external remedies under Australian employment law.
Knowing how disputes are handled can help you navigate issues like unpaid entitlements or contract breaches in the future.
Seek Professional Advice if Unsure
Even with careful reading, legal documents can be dense and full of jargon. If anything seems unclear or unfair, it’s worth seeking professional advice before signing. Employment lawyers can explain your rights, identify hidden risks, and suggest amendments that protect your interests.
This is especially important for senior roles, contract positions, or jobs involving commission, intellectual property, or international travel. Spending a little on advice upfront can prevent far bigger problems down the line.
Before you sign any employment contract, remember that it’s not just about landing the job — it’s about safeguarding your future. Take the time to read carefully, ask questions, and clarify anything that feels ambiguous. Employers respect employees who show diligence and professionalism. By entering the relationship with clear expectations and mutual understanding, you’ll not only start your new role on solid ground but also set yourself up for a long, successful, and conflict-free career.