Free Employment Contract Template (PDF & Word) – 2026

If you have ever paid an attorney to draft a employment contract, you know that the first hour is spent on standard provisions that look almost identical in every version they produce. That is because the underlying law is the same. This template gives you those standard provisions, properly assembled, so you can focus your attorney’s time (if you use one) on the parts that are actually specific to your transaction.

This page provides a free employment contract template in PDF and Microsoft Word format. The template is suitable for full-time employees and includes the standard provisions employers and employees expect: position and duties, compensation and benefits, term, confidentiality, IP assignment, restrictive covenants (state-customizable), and termination procedures.

When You Need an Employment Contract

• Executive and C-level positions. Compensation, equity, term, severance must be specified.
• Specialized roles. Roles with significant IP, confidentiality, or non-compete components.
• Fixed-term hires. Roles with a defined end date or term-of-years commitment.
• Roles with significant equity. Stock options, RSUs, equity grants tied to employment.
• Sales positions. Commission structure, draw, clawback provisions.
• Relocation hires. Sign-on bonus, relocation reimbursement, repayment obligations.
• Family members. Avoid disputes by formalizing employment of family in family-owned businesses.

Essential Provisions

• Parties and effective date. Employer entity and employee, start date.
• Position and duties. Title, reporting, scope, time commitment.
• Term. At-will or fixed term with specific end date.
• Compensation. Base salary, bonus structure, commission (if applicable), equity, payment frequency.
• Benefits. Health insurance, 401(k), PTO, sick leave, holidays.
• Work location and schedule. Office, remote, hybrid; standard hours.
• Expense reimbursement. What is reimbursable.
• Confidentiality. Definition and duty.
• IP assignment. Inventions, work product belong to employer.
• Restrictive covenants. Non-compete (state-permitting), non-solicit, non-disparagement.
• Termination. At-will or for-cause provisions; severance.
• Notice. Termination notice required of each party.
• Dispute resolution. Negotiation, mediation, arbitration, court.
• Governing law. State whose law applies.

Frequently Asked Questions

What is an employment contract?

An employment contract is a written agreement between an employer and an employee defining the terms of employment: compensation, position, duties, benefits, term, and conditions for termination. In the U.S., most employment is «at-will» (either party can terminate at any time) — a written contract typically modifies that default for executives, specialized roles, and term-of-years arrangements.

Is an employment contract required?

No — at-will employment without a written contract is the default in 49 U.S. states (Montana is the exception with after-probation just-cause requirements). However, written contracts are strongly recommended for executive roles, specialized positions, fixed-term hires, and any role with equity, complex compensation, or restrictive covenants.

What is the difference between at-will employment and an employment contract?

At-will means either party can end employment at any time, with or without cause, with or without notice. An employment contract may modify at-will status — establishing a term of employment, requiring cause for termination, or specifying notice periods.

What should an employment contract include?

Parties, position and duties, start date, term (at-will or fixed), compensation (salary/hourly, bonus, equity), benefits, work location, schedule, vacation/PTO, confidentiality, IP assignment, non-compete (where enforceable), termination provisions, dispute resolution, governing law.

Can an employment contract include non-compete clauses?

Yes, subject to state law. California voids non-competes for most employees. Many other states enforce reasonable non-competes. The 2024 FTC non-compete ban was struck down by federal court but FTC continues to litigate.

What is a probationary period?

A specified initial period (typically 30-90 days) during which the employer can terminate without cause and without severance. The probationary period must comply with state law — some states have specific notice requirements.

Can the contract be modified later?

Yes, by written amendment signed by both parties. Unilateral changes by the employer (e.g., changing compensation) may breach the contract; the employer must notify and (ideally) obtain employee consent.

What happens if the employer breaches the contract?

The employee may sue for breach of contract damages — typically the difference between contract compensation and actual earnings during the remaining term. Many states require mitigation (the employee must seek other work).

Download the Free Employment Contract

The template above is a starting point — not a substitute for legal counsel. State laws change, court interpretations evolve, and individual circumstances vary in ways a generic form cannot anticipate. We update this template at least annually, but verify the current state-specific requirements before relying on it for any significant transaction. Consult an attorney for stakes above $25,000 or any disputed matter.

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