This information is only relevant to employers and employees in the WA state industrial relations system.

About employment contracts

When an employer offers someone a job, an employment contract is being entered into. This is a legal relationship under which both the employer and the employee have rights and obligations.

Generally an employment contract is made between the employer and a new employee when:

• there is an offer of employment, verbally or in writing and the offer is accepted by the employee;
• each party has accepted an obligation to perform their part of the agreement, and the employee will receive a regular wage and generally other entitlements such as leave and superannuation payments in return for working;
• the employee will perform work under the direction of the employer and will work the hours determined by the employer; and
• the employer is responsible for making income tax deductions for the employee.

There is no legal requirement to have a written employment contract with an employee, but it is good business practice and an important safeguard to document what has been agreed between employer and employee about pay, hours and other conditions. If there is ever a dispute about employment entitlements, it is difficult to prove what was agreed without something in writing.

Employment contracts must meet WA award and minimum wage rates

In the state system, many employees are covered by a WA award. WA awards are legal documents that outline legal pay rates, allowances, working hours, and leave entitlements for employees in a particular industry or type of work.

Award coverage is based on the type of work an employee performs and the industry of their employer, and each WA award contains a clause which specifies who that award covers. For example, the Restaurant, Tearoom and Catering Workers Award applies to counter hands, wait staff and kitchen staff working in restaurants, cafes and take away food businesses. The WA awards for common jobs page outlines some of the most common jobs and the relevant WA awards that apply to employees in state system businesses.  If an employee is covered by a WA award, the pay rates, leave entitlements, allowances and penalty rates (such as higher pay for working on the weekend or a public holiday) outlined in the WA award must be provided to the employee.

If an employee is not covered by a WA award, the current minimum rate of pay and the leave entitlements in the Minimum Conditions of Employment Act 1993 are the minimum legal entitlements of the employee. It is unlawful to provide pay rates or leave conditions below these standards. Visit the Minimum rates of pay for award free employees page for more information.

An employment contract is not valid if it provides lower wages than the wages in a WA award that covers the employee, or lower wages than the state minimum wage if the employee is award free.

It is unlawful for you to negotiate or come to an agreement with your employee to ignore or provide lower wages that the relevant WA award or minimum wage.

The What to include in an employment contract section below highlights key information which could be included.

What to include in an employment contract

A written employment contract should include information on the agreed employment arrangements and the employee's entitlements under a relevant WA award and state employment laws.

This page lists the types of matters that could be included in an employment contract. These lists are not exhaustive and are provided as a general guide only. It may be appropriate to include other matters depending upon the particular workplace situation.