Story: My aunt and her maid
My aunt once had a “live in” maid working in her house. A “live in” maid is one that stays in the house or is commonly known as a “full time maid”. On the first day when the maid reported for work, my aunt showed the maid around the house and went through with her the housework that the maid was to carry out. My aunt and her family looked after the maid very well, buying her new clothes and giving her salary in advance so that she could send the money to her family. To be honest, there was not very much work for the maid to do in the house as my aunt lived in a terrace house with my uncle and my cousin who was in his 30s then. By the afternoon, the maid would be watching television with the family, prepare an early dinner and then be off to bed. Every Sunday, the maid was given a day off. My cousin would give her some money (which was not part of the contract) for her to spend on her day off.
One day, my aunt wanted to clear some old things from the closet in the house. As my aunt was in her early 70s then, she asked the maid to assist her. However, the maid just stood and watched. The maid replied that clearing the closet was not her duty. In other words, it was not her job to clear the closet. My aunt was confused and asked her to explain. The maid told my aunt that clearing the closet was not mentioned to her as part of her duties on the first day when she reported for work. My aunt informed the maid that she might not have mentioned about clearing the closet to the maid as this was not something that was required to be done everyday but it was part of the housework to be carried out once in a long while.
So, we have a dilemma here. On the one hand, you have my aunt who felt that clearing the closet was part of the maid’s job and on the other hand, we have the maid who felt that clearing the closet was something extraordinary and out of her normal duties. Well, if you looked at it, both may be correct. My aunt may not have informed or made clear to the maid that from to time the maid would be required to do some work relating to the house which was not routine (ie: clearing the closet) which she deemed as part of the maid’s duties. On the other hand, the maid felt that since this was not related to her as part of her duties on the first day, she considered this as something additional. Needless to say, my aunt paid the maid extra for clearing the closet which I know that she would have done anyway regardless of whether it was part of the maid’s duties or not.
This misunderstanding could have been avoided if my aunt had informed the maid that she would have to perform housework which was not routine but was related to the house as may be directed from time to time. Since there was no written contract, my aunt should have put this clearly to the maid on the first day when the maid reported for work. As explained earlier, a contract of employment is negotiable. If the maid was not happy at that point of time, she could have raised that with my aunt. Therefore, when you have a “catch all” clause in the Contract of Service, ensure that the employee understands what it means and the kind of work that the employer may require from time to time.
(b) Medical benefits
Larger companies will have group medical health insurance that will cover their employees. However, smaller companies may not have such a benefit for their employees. As a matter of fact, some smaller companies may not even have a panel of clinics that the employee may visit in the event that the employee is sick. Another issue that a small company may have is the limit of the medical claim. A small company may be worried that the medical claim by the employees may amount to more than what the Employer can afford. Therefore, you may want to place a limit on the medical claim by the employees after taking into consideration the Employer’s financial strength. You may want to place a monetary limit for outpatient treatment and inpatient treatment (if you are covering hospitalisation as well). In the Contract of Service, you may want to insert a clause along this line:-
“Basic medical expenses for medical treatment received by you up to a maximum of $.....(state the amount) per calendar year shall be borne by the firm. Until such time when the firm has its nominated panel of clinics, you may seek medical treatment from a clinic of your choice and the firm shall reimburse you for the basic medical expenses incurred.”
(c) Leave
An employee is entitled to a number of days of leave from work. If there is a statutory requirement on the number of leave that must be granted to an employee then obviously you must have a figure not lower than the minimum in the Contract of Service.
An important point to note is that you need to state clearly in your Contract of Service whether the leave which is not utilised by the employee can be brought forward to the following year. If you allow the employee to carry forward the leave then there ought to be a maximum number of days of leave that the employee may carry forward.
Another issue is what happens when the employee resigns having accumulated many days of unused leave. As an Employer, you may have to compensate the employee with the number of days of leave that the employee has not taken. I know of a company where an employee hardly took any leave from work. When the employee decided to resign, the employee gave notice of resignation but did not state that she was intending to claim for the leave which was not taken. A day before the resignation was to take effect, the employee listed the number of days of leave not taken by her and submitted it to the Accounts Department. Obviously the boss was taken aback but had no alternative but to compensate the employee as the Contract of Service was silent on leave not taken. If a clause is inserted to state that all leave entitlement is to be utilised before the resignation is to take effect then the company could have avoided paying the hefty compensation.
(d) Notice of Resignation
Most companies would normally require a minimum of one month notice before the resignation takes effect. There are also instances where companies require 6 months notice. One of the reasons for a longer notice period is because the duties performed by the employee may be complicated and require a longer time for a replacement to grasp. There are also instances, though it is not common, where the Contract of Service states that in the event the Employer requires the employee to come back to complete the work either on a weekend or after hours, the employee is required to comply and will be given a pro-rated payment based on the last drawn salary. This normally takes place where the employee is carrying out duties in a project or specific assignment. I understand that some law firms have this clause in their Contract of Employment. If you look at it carefully, you may ask whether this clause is legally enforceable? In other words, does a former Employer have the right to sue a former Employee for specific performance (ie: to make the former employee comply with the Contract of Employment)? I believe that when the employee has resigned, the Contract of Employment would cease to exist so there would no longer be a basis for such an action. Other legal minds may have a different view on this matter.
(e) Retirement age
Nowadays, it may no longer be an issue as the retirement age is clearly stated in most Contracts of Employment. However, for some of the older contracts, the retirement age may not be stated. This could be due to the practice in those days. It could be an understanding between the employers and the employees that the employees in the private sector will have the same retirement age as those working in the government sector. Therefore, there was no necessity to state the retirement age. However, in today’s litigious world and to avoid any ambiguity, it is strongly recommended that you state the retirement age in your Contract of Service.
The above tips on drafting the Contract of Employment are just some guidelines to assist the Employer, especially those who are operating on a small scale to have an idea of some of the essential clauses to be inserted in the Contract. By no means are those clauses meant to be comprehensive. At the end of the day, both parties must be comfortable with the Contract to achieve balance and harmony in the workplace.
My aunt once had a “live in” maid working in her house. A “live in” maid is one that stays in the house or is commonly known as a “full time maid”. On the first day when the maid reported for work, my aunt showed the maid around the house and went through with her the housework that the maid was to carry out. My aunt and her family looked after the maid very well, buying her new clothes and giving her salary in advance so that she could send the money to her family. To be honest, there was not very much work for the maid to do in the house as my aunt lived in a terrace house with my uncle and my cousin who was in his 30s then. By the afternoon, the maid would be watching television with the family, prepare an early dinner and then be off to bed. Every Sunday, the maid was given a day off. My cousin would give her some money (which was not part of the contract) for her to spend on her day off.
One day, my aunt wanted to clear some old things from the closet in the house. As my aunt was in her early 70s then, she asked the maid to assist her. However, the maid just stood and watched. The maid replied that clearing the closet was not her duty. In other words, it was not her job to clear the closet. My aunt was confused and asked her to explain. The maid told my aunt that clearing the closet was not mentioned to her as part of her duties on the first day when she reported for work. My aunt informed the maid that she might not have mentioned about clearing the closet to the maid as this was not something that was required to be done everyday but it was part of the housework to be carried out once in a long while.
So, we have a dilemma here. On the one hand, you have my aunt who felt that clearing the closet was part of the maid’s job and on the other hand, we have the maid who felt that clearing the closet was something extraordinary and out of her normal duties. Well, if you looked at it, both may be correct. My aunt may not have informed or made clear to the maid that from to time the maid would be required to do some work relating to the house which was not routine (ie: clearing the closet) which she deemed as part of the maid’s duties. On the other hand, the maid felt that since this was not related to her as part of her duties on the first day, she considered this as something additional. Needless to say, my aunt paid the maid extra for clearing the closet which I know that she would have done anyway regardless of whether it was part of the maid’s duties or not.
This misunderstanding could have been avoided if my aunt had informed the maid that she would have to perform housework which was not routine but was related to the house as may be directed from time to time. Since there was no written contract, my aunt should have put this clearly to the maid on the first day when the maid reported for work. As explained earlier, a contract of employment is negotiable. If the maid was not happy at that point of time, she could have raised that with my aunt. Therefore, when you have a “catch all” clause in the Contract of Service, ensure that the employee understands what it means and the kind of work that the employer may require from time to time.
(b) Medical benefits
Larger companies will have group medical health insurance that will cover their employees. However, smaller companies may not have such a benefit for their employees. As a matter of fact, some smaller companies may not even have a panel of clinics that the employee may visit in the event that the employee is sick. Another issue that a small company may have is the limit of the medical claim. A small company may be worried that the medical claim by the employees may amount to more than what the Employer can afford. Therefore, you may want to place a limit on the medical claim by the employees after taking into consideration the Employer’s financial strength. You may want to place a monetary limit for outpatient treatment and inpatient treatment (if you are covering hospitalisation as well). In the Contract of Service, you may want to insert a clause along this line:-
“Basic medical expenses for medical treatment received by you up to a maximum of $.....(state the amount) per calendar year shall be borne by the firm. Until such time when the firm has its nominated panel of clinics, you may seek medical treatment from a clinic of your choice and the firm shall reimburse you for the basic medical expenses incurred.”
(c) Leave
An employee is entitled to a number of days of leave from work. If there is a statutory requirement on the number of leave that must be granted to an employee then obviously you must have a figure not lower than the minimum in the Contract of Service.
An important point to note is that you need to state clearly in your Contract of Service whether the leave which is not utilised by the employee can be brought forward to the following year. If you allow the employee to carry forward the leave then there ought to be a maximum number of days of leave that the employee may carry forward.
Another issue is what happens when the employee resigns having accumulated many days of unused leave. As an Employer, you may have to compensate the employee with the number of days of leave that the employee has not taken. I know of a company where an employee hardly took any leave from work. When the employee decided to resign, the employee gave notice of resignation but did not state that she was intending to claim for the leave which was not taken. A day before the resignation was to take effect, the employee listed the number of days of leave not taken by her and submitted it to the Accounts Department. Obviously the boss was taken aback but had no alternative but to compensate the employee as the Contract of Service was silent on leave not taken. If a clause is inserted to state that all leave entitlement is to be utilised before the resignation is to take effect then the company could have avoided paying the hefty compensation.
(d) Notice of Resignation
Most companies would normally require a minimum of one month notice before the resignation takes effect. There are also instances where companies require 6 months notice. One of the reasons for a longer notice period is because the duties performed by the employee may be complicated and require a longer time for a replacement to grasp. There are also instances, though it is not common, where the Contract of Service states that in the event the Employer requires the employee to come back to complete the work either on a weekend or after hours, the employee is required to comply and will be given a pro-rated payment based on the last drawn salary. This normally takes place where the employee is carrying out duties in a project or specific assignment. I understand that some law firms have this clause in their Contract of Employment. If you look at it carefully, you may ask whether this clause is legally enforceable? In other words, does a former Employer have the right to sue a former Employee for specific performance (ie: to make the former employee comply with the Contract of Employment)? I believe that when the employee has resigned, the Contract of Employment would cease to exist so there would no longer be a basis for such an action. Other legal minds may have a different view on this matter.
(e) Retirement age
Nowadays, it may no longer be an issue as the retirement age is clearly stated in most Contracts of Employment. However, for some of the older contracts, the retirement age may not be stated. This could be due to the practice in those days. It could be an understanding between the employers and the employees that the employees in the private sector will have the same retirement age as those working in the government sector. Therefore, there was no necessity to state the retirement age. However, in today’s litigious world and to avoid any ambiguity, it is strongly recommended that you state the retirement age in your Contract of Service.
The above tips on drafting the Contract of Employment are just some guidelines to assist the Employer, especially those who are operating on a small scale to have an idea of some of the essential clauses to be inserted in the Contract. By no means are those clauses meant to be comprehensive. At the end of the day, both parties must be comfortable with the Contract to achieve balance and harmony in the workplace.
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