With such an assortment of online templates, downloadable employment agreements, and free basic legal documents, it can be difficult knowing what goes where, how to apply it to your business and how to go about implementing this to give your business as much protection as possible. One area that is in need of some further clarification is employment law, and more specifically the difference between an Employment Agreement and an Employee Handbook.

Employment Agreement

The Employment Agreement is an extremely useful document for governing any type of employment relationship.

A well-drafted Employment Agreement will set out the rights and obligations of the employee and employer. For the employee, this will include the right to be paid and the right to particular entitlements under the relevant award or National Employment Standards (“NES”) in return for a certain level of service and performance. For the employer, this will include the right to receive services from the employee, and the obligation to provide them with a safe environment and adequate remuneration.

Employee Handbook

An Employee Handbook is an internal workplace manual that explains how the employees are expected to behave in their role at the workplace. It is also sometimes known as a Policies and Procedures Manual because it deals with the numerous workplace policies and procedures that should be followed by employees of the business. There are several reasons why the Employee Handbook is its own legal document and is not typically incorporated into the Employment Agreements. These have been set out below:

  • The rules, policies and procedures contained within an Employee Handbook are applicable to every staff member, whereas an Employment Agreement applies to just the one employee.
  • An Employment Agreement contains only the rights and obligations of the parties to the Agreement with respect to the specific role, whereas an Employee Handbook has a variety of strict and soft ‘optional’ policies that are not enforceable at law and would be difficult to enforce under an Employment Agreement.
  • To amend, change or alter in any way an Employment Agreement, an employer would need the consent of the employee. Employee Handbooks can, however, be amended from time to time, without prior notice to the employees.

Tips for Employers

If you wish to give your business the protection it needs and deserves, you should do the following:

  • always have Employment Agreements in place with all staff;
  • always use an Employee Handbook; and
  • within the Employment Agreement, have a clause which requires the employee to comply with any, and all, current and future workplace policies.


If you have any questions relating to employment law, or would like assistance in either drafting or reviewing an Employment Agreement and Employee Handbook, contact LegalVision on 1300 544 755 to speak to one of our experienced employment law specialists.

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