Sample Employment Agreement Template for Minnesota Businesses

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Employment Agreement


THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into and effective as of _____________, 20___, by and between ________________________, a Minnesota __________________, with its principal place of business at ____________________________ (the “COMPANY”) and ____________________, individual residence at _______________________ (the “EMPLOYEE”).

Main Text

A. The parties wish to provide for the employment of the EMPLOYEE by the COMPANY.

B. The EMPLOYEE wishes to receive compensation from the COMPANY for the EMPLOYEE’s services, and the COMPANY wants reasonable protection of its confidential business and technical information that has been acquired and is being developed by the COMPANY at substantial expense.

In consideration of mutual promises and conditions contained herein, the COMPANY and the EMPLOYEE, each intending to be legally bound, agree as follows:

1. Employment.

Subject to all of the terms and conditions of this Agreement, the COMPANY agrees to employ the EMPLOYEE as a _________________________ in the business of the COMPANY, and the EMPLOYEE accepts such employment.

2. Duties.

(a) The EMPLOYEE will devote substantially all of her/his business hours to, and, during such time, make the best use of her/his energy, knowledge and training in advancing the COMPANY’s interests. The EMPLOYEE will diligently and conscientiously perform the duties of the EMPLOYEE’s position within the general guidelines to be determined and assigned by the COMPANY’s _________________. The EMPLOYEE will report to the ______________, who will be responsible for evaluating job performance. While the EMPLOYEE is employed by the COMPANY, the EMPLOYEE will keep the COMPANY informed of any other business activities or outside employment, and will promptly stop any activity or employment that might conflict with the COMPANY’s interests or adversely affect the performance of the EMPLOYEE’s duties for the COMPANY.


(a) The EMPLOYEE shall devote EMPLOYEE’s full business time and best efforts and abilities to the COMPANY in the performance of EMPLOYEE’s duties and responsibilities determined and assigned by the COMPANY’s _________________ and shall engage in no other business, either directly or indirectly, in EMPLOYEE’s own behalf, or as an employee or independent contractor of another employer. EMPLOYEE shall report to the ______________ or to such other individual as COMPANY may otherwise direct. EMPLOYEE shall promptly obey and comply with all rules, regulations, and orders that may be issued from time to time by the COMPANY.

(b) Notwithstanding the above, the EMPLOYEE shall be permitted, to the extent such activities do not interfere with the performance of her/his duties and responsibilities to (i) manage her/his personal, financial and legal affairs, (ii) serve on civic or charitable boards or committees, (iii) serve on boards of other companies of organization that do not compete with COMPANY or any related entity in any shape or form, and the EMPLOYEE shall be entitled to receive and retain all remuneration received by her/him from the items listed in clauses (i) through (iii) of this paragraph.

3. Term.

The term of this Agreement shall commence on the date first written above and continue unless terminated in accordance with Section 6 below.

4. Compensation.

(a) Wages.

The COMPANY agrees to pay the EMPLOYEE an annual base salary of $____________ , in equal _____________ installments (“Base Pay”) –or- __ an hour on weekly/bi-weekly/monthly installments (“Base Pay”), and 1 ½ the regular hourly rate for all hours worked over 40 in accordance with the standard payroll practices of the COMPANY. Within 30 days of the annual anniversary date of this Agreement and within 30 days of every annual anniversary thereafter, during the term of this Agreement, the Base Pay will be reviewed by the _____________, considering both the EMPLOYEE’s performance and the performance of the COMPANY during the preceding calendar year. If the EMPLOYEE’s Base Pay is adjusted by the COMPANY, such adjusted Base Salary shall then constitute the Base Pay for all purposes under this Agreement.

(b) Vacation.

The EMPLOYEE will be entitled to ___ days per year of personal time off (“PTO”) and all legal holidays observed by the COMPANY, in each case, in accordance with the COMPANY’s policies as in effect from time-to-time. In the event EMPLOYEE does not use all PTO for a given fiscal year, up to ___ days of unused PTO may be carried over to the next fiscal year. The EMPLOYEE will additionally be allowed to work from home up to ___% of all work days.

(c) Sickness and Disability.

If, during employment, EMPLOYEE is prevented from carrying on her/his duties in accordance with the terms of this Agreement as a result of mental or phyiscal injury as determined by the COPMANY or an examining physician acceptable to the COMPANY, COMPANY will continue EMPLOYEE’s full compnesation for so long as, and to the extent of, the sick leave policy in accordance with the COMPANY’s applicable policies and practices made available by the COMPANY to other peer employees of the COMPANY.

(d) Deductions.

The COMPANY will deduct and withhold from any compensation payable to the EMPLOYEE under this Agreement such amounts as the COMPAY is required to deduct and withhold by law. The COMPANY may also deduct and withhold from any such compensation, to the extent permitted by law, such amounts as the EMPLOYEE may owe to the COMPANY.

(e) Business Expenses.

COMPANY shall reimburse EMPLOYEE for all reasonable business expenses incurred in performing her/his duties as an EMPLOYEE. Such expenses shall be reimbursed in accordance with COMPANY’s standard expense reimbursement procedure made available by the COMPANY to other peer employees of the COMPANY.

5. Benefits, bonuses and incentives

(a) Benefits and Insurance.

As EMPLOYEE becomes eligible, EMPLOYEE may participate in and shall receive benefits under benefit plans, policies, and programs, including medical, dental, disability, and life insurance plans and programs made available by the COMPANY to other peer employees of the COMPANY.

(b) Bonus, Incentive, Savings, and Retirement Plans.

As EMPLOYEE becomes eligible, EMPLOYEE shall be entitled to participate in all bonus, incentive, stock option, savings, and retirement plans, policies, and programs made available by the COMPANY to other peer employees of the COMPANY.

6. Termination.

Subject to the respective continuing obligations of the COMPANY and the EMPLOYEE under Sections 7 and 8 below:

(a) Employment At-Will.

Nothing in this Agreement is intended to establish any minimum period of the EMPLOYEE’s continuing employment, and such employment continues to be on an “at-will” basis. The EMPLOYEE acknowledges that her/his employment with COMPANY is terminable at will at any time by either party.

(b) For Cause.

The COMPANY may terminate this Agreement immediately upon written notice to the EMPLOYEE for cause, which will include (i) dishonesty, fraud, material and deliberate injury or attempted injury, in each case related to the COMPANY, its business, or other employees, (ii) any unlawful or criminal activity of a serious nature, (iii) any willful breach of duty or habitual neglect of duty or (iv) any breach of Sections 6 or 7 of this Agreement. Upon termination of this Agreement, the COMPANY will pay the EMPLOYEE accrued but unpaid compensation through the date of termination, any unpaid reimbursable business expenses incurred and documented by Employee in accordance with this Agreement, and any bonus or incentive compensation earned in accordance with this Agreement through the date of termination.

(c) For other reason(s). If, at any time after the completion of the EMPLOYEE’s first year of service, the COMPANY terminates this Agreement for reasons other than cause, the COMPANY will pay the EMPLOYEE accrued but unpaid compensation through the date of termination including any unpaid reimbursable business expenses incurred and documented by Employee in accordance with this Agreement, any bonus or incentive compensation earned in accordance with this Agreement, and at the discretion of the COMPANY, up to ____ months of salary as severance pay.

(d) Upon termination by EMPLOYEE.

EMPLOYEE shall be entitled to receive any accrued but unpaid compensation through the date of termination, including any bonus or incentive compensation earned in accordance with this Agreement;

(e) Due to Death or “permanent disability.” This Agreement will terminate upon the EMPLOYEE’s death, “permanent disability” or dissolution of the EMPLOYEE as the case might be. For purposes of this Agreement the term “permanent disability” means the occurrence of an event which constitutes permanent and total disability within the meaning of Section 22(e)(3) of the United States Code. In the event of the EMPLOYEE’s death or “permanent disability” as the case might be all outstanding amounts due and payable to the EMPLOYEE under this Agreement shall be paid to EMPLOYEE’s estate.

7. Inventions.

(a) Definition.

“Inventions,” as used in this Agreement, means any inventions, discoveries, software programs, code, improvements and ideas, whether or not in writing or reduced to practice and whether or not patentable or copyrightable, made, authored or conceived by the EMPLOYEE, whether by the EMPLOYEE’s individual efforts or in connection with the efforts of others, and that either (i) relate in any way to the COMPANY’s business, products or processes, past, present, anticipated or under development, or (ii) result in any way from the EMPLOYEE’s employment by the COMPANY, or (iii) use of the COMPANY’s equipment, supplies, facilities or trade secret information.

(b) Ownership of Inventions.

1. Unless the conditions in subsection (b)(2) of this section are met, the EMPLOYEE agrees that all Inventions made by the EMPLOYEE during the period of the EMPLOYEE’s employment with the COMPANY and for six (6) months thereafter, whether made during the working hours of the COMPANY or on the EMPLOYEE’s own time, will be the sole and exclusive property of the COMPANY. The EMPLOYEE will, with respect to any Invention: (i) keep current, accurate, and complete records, which will belong to the COMPANY and be kept and stored on the COMPANY’s promises; (ii) promptly and fully disclose the existence and describe the nature of the Invention to the COMPANY in writing (and without request); (iii) assign (and the EMPLOYEE hereby assigns by executing this Agreement) to the COMPANY all of the EMPLOYEE’s right, title and interest in and to the Invention, any applications the EMPLOYEE makes for patents or copyrights in any country, and any patents or copyrights granted to the EMPLOYEE in any country; and (iv) acknowledge and deliver promptly to the COMPANY any written instruments, and perform any other acts necessary in the COMPANY’s opinion to preserve property rights in the Invention against forfeiture, abandonment or loss and to obtain and maintain letters patent and/or copyrights on the Invention and to vest the entire right and title to the Invention in the COMPANY. The EMPLOYEE agrees to perform promptly (without charge to the COMPANY but eligible for reimbursement by the COMPANY up establishment of reasonableness) all acts as may be necessary in the COMPANY’s opinion to preserve all patents and/or copyrights granted upon the EMPLOYEE’s Inventions or to prevent forfeiture, abandonment or loss.

2. The requirements of this Section 7(b) do not apply to any Invention for which no equipment, supplies, facility or trade secret information of the COMPANY was used and which was developed entirely on the EMPLOYEE’s own time, and (i) which does not relate directly to the COMPANY’s business or to the COMPANY’s actual or demonstrably anticipated research or development, or (ii) which does not result from any work the EMPLOYEE performed for the

COMPANY. The EMPLOYEE represents that, except as disclosed below, as of the date of this Agreement, the EMPLOYEE has no rights under and will make no claims against the COMPANY with respect to, any inventions, discoveries, improvements, ideas or works of authorship which would be Inventions if made, conceived, authored or acquired by the EMPLOYEE during the term of this Agreement.

(c) Works Made for Hire.

To the extent that any Invention qualifies as “work made for hire” as defined in 17 U.S.C. §101 (1976), as amended, such Invention will constitute “work made for hire” and, as such, will be the exclusive property of the COMPANY.

(d) Other Works.

If any Invention does not qualify as “work made for hire” as defined in 17 U.S.C.. §101 (1976), as amended, EMPLOYEE agrees to assign the patent right, copyright, and all other protectable interest rights in the Invention to the COMPANY.

(e) Presumption.

In the event of any dispute, arbitration or litigation concerning whether any Invention made or conceived by the EMPLOYEE is the property of the COMPANY, such Invention will be presumed the property of the COMPANY and the EMPLOYEE will bear the burden of establishing otherwise, and if it is established otherwise, the COMPANY will reimburse EMPLOYEE for the cost of arbitration or litigation involved in such determination.

(f) Survival.

The obligations of this Section 7 will survive the termination of this Agreement.

8. Confidential Information.

(a) Prohibition on Use of Confidential Information.

The EMPLOYEE agrees not to directly or indirectly disclose or use at any time, either during or subsequent to her/his employment by the COMPANY and any of its subsidiaries or affiliates (which obligation will survive indefinitely), any code, software, technology, trade secrets, know-how, or other information, knowledge, or data possessed, used or licensed by the COMPANY or to which the EMPLOYEE gains access in connection with her/his employment and which the COMPANY deems confidential, proprietary or protected under grant of license or which the EMPLOYEE has reason to believe is confidential, proprietary or protected under grant of license, except as such disclosure or use may be required in connection with her/his work for the COMPANY or unless the EMPLOYEE first secures the written consent of the COMPANY. Upon termination of her/his employment, the EMPLOYEE will promptly return to the COMPANY all originals and all copies of all property and assets of the COMPANY created or obtained by the EMPLOYEE as a result of or in the course of or in connection with her/his employment with the COMPANY which are in the EMPLOYEE’s possession or control, whether confidential or not, including, but not limited to computer files, software programs, computer equipment, correspondence, notes, memoranda, notebooks, drawing, customer lists, or other documents delivered to or obtained by the EMPLOYEE concerning any idea, product, apparatus, invention or process manufactured, used, developed, investigated, or marketed by the COMPANY during the period of her/his employment.

(b) Third-Party Information.

The EMPLOYEE understands and acknowledges that the COMPANY has a policy prohibiting the receipt by the COMPANY of any confidential information in breach of the EMPLOYEE’s obligations to third parties and does not desire to receive any confidential information under such circumstances. Accordingly, the EMPLOYEE will not disclose to the COMPANY or use in the performance of any duties for the COMPANY any confidential information in breach of an obligation to any third party. The EMPLOYEE represents that s/he has provided the COMPANY with a copy of any agreement by which the EMPLOYEE is bound that restrict the EMPLOYEE’s use of any third party’s confidential information and all such agreements are set forth on Exhibit “B” which is incorporated herein.

(c) Survival.

The obligations of this Section 8 will survive the termination of this Agreement.

9. Covenant Against Competition

(a) The EMPLOYEE will not do, or attempt to do any of the following, either directly or indirectly, during the period that EMPLOYEE is employed by the COMPANY or during the period of ___ years after EMPLOYEE’s employment terminates, within ____miles of any business of the COMPANY, or within the radio, cable or television marketing range of any business of the COMPANY: (i) competeagainst the COMPANY; (ii) carry on a business similar to the COMPANY’s business; (iii) engage in a business similar to the COMPANY’s business; (iv) solicit old or current customers of the COMPANY; or (v) own, manage, be employed by, work for, consult for, be an officer or director of, advise, represent, engage in, or carry on any business engaged in, or similar to, the type of business engaged in by the COMPANY at that time.

(b) Survival.

The obligations of this Section 9 will survive the termination of this Agreement.

10. Arbitration

(a) Procedure.

All claims, disputes, controversies, or disagreements of any kind whatsoever (“claims”) including any claims arising out of or in connection with EMPLOYEE’s employment or the termination of EMPLOYEE’s employment, that may arise between EMPLOYEE and the COMPANY, including any claims that may arise between EMPLOYEE and the COMPANY’s officers, directors, employees, or agents in their capacity as such, shall be submitted to final and binding arbitration before a competent arbitration body in the county of COMPANIES principle place of business in accordance with the rules and procedures of the American Arbitration Association then existing.

(b) Covered Claims.

Claims covered by this arbitration provision include, but are not limited to the following: (i) Alleged violations of federal, state, or local constitutions, statutes, regulations, or ordinances, including, but not limited to, antidiscrimination and harassment laws; (ii) Allegations of a breach of a contractual obligation; and (iii) Alleged violations of public policy.

(c) Excluded Claims.

The following are expressly excluded from this arbitration provision and are not covered by this Agreement: (i) Claims related to workers’ compensation or unemployment insurance; (ii) Administrative claims filed with government agencies such as the Equal Employment Opportunity Commission, or the National Labor Relations Board; and (iii) Claims that are expressly excluded by statute or are expressly required to be arbitrated under a different procedure required by the COMPANY’s employee benefit plan.

(d) Consideration and waiver.

In consideration for and as a material condition of EMPLOYEE’s employment with the COMPANY, EMPLOYEE agrees that final and binding arbitration is the exclusive means for resolving the claims outlined in this Agreement. However, this agreementdoes not in any way alter the at-will status of EMPLOYEE’s employment. This Agreementis a waiver of all rights EMPLOYEE may have to a civil court action on any dispute outlined by this Agreement. Accordingly, only an arbitrator, not a judge or jury, will decide the dispute, although the arbitrator has the authority to award any type of relief that could otherwise be awarded by a judge or jury.

(e) The EMPLOYEE and the COMPANY shall each pay for their own filing and attorney fees or costs of representation for purposes of the arbitration unless otherwise provided by this Agreement, law or agreed to by the parties.

(f) Survival.

The obligations of this Section 10 will survive the termination of this Agreement.

11. Miscellaneous.

(a) Conflicts of Interest.

The EMPLOYEE agrees that s/he will not, directly or indirectly, transact business with the COMPANY personally, or as an agent, owner, partner or shareholder of any other entity, provided, however, that any such transaction maybe entered into if approved by the Board.

(b) Injunction and Damages.

EMPLOYEE agrees that this Agreementis important, material, confidential, and gravely affects the effective and successful conduct of the business of the COMPANY and affects its reputation and goodwill, and that the COMPANY is entitled to obtain damages for any breach of this Agreement, including but not limited to compensatory, incidental, consequential, exemplary, and lost-profits damages. Furthermore, if the EMPLOYEE fails to fulfill the EMPLOYEE’s obligations under this Agreement in addition to any other rights or remedies available to the COMPANY at law, in equity, or by statute, the EMPLOYEE hereby consents to the specific enforcement of this Agreement by the COMPANY through an injunction or restraining order issued by an appropriate court. EMPLOYEE also agrees to pay the COMPANY’s reasonable attorney’s fees and costs for enforcement of this Agreementin the event that Employee shall breach any of the terms hereof.

(c) Successors and Assigns.

This Agreement is binding on and inures to the benefit of the COMPANY’S successors and assigns, (all of which are included in the team the “COMPANY” as it is used in this Agreement); provided, however, that the COMPANY may assign this Agreement only in connection with a merger, consolidation, assignment, sale of other disposition of substantially all of its assets or business.

(d) Modification.

This Agreement may be modified or amended only by a written statement signed by both the COMPANY and the EMPLOYEE.

(e) Governing Law.

The laws of the State of Minnesota will govern the validity, construction and performance of this Agreement. Any legal proceeding not covered by Section 10 (Arbitration) will be brought in an appropriate Minnesota court, and both the COMPANY and the EMPLOYEE hereby consent to the exclusive jurisdiction of that court for this purpose.

(f) Construction and severability.

Wherever possible, each provision of this Agreement will be interpreted so that it is valid under the applicable law. If any provision of this Agreement is to any extent invalid under the applicable law that provision will still be effective to the extent it remains valid. The remainder of this Agreement also will continue to be valid, and the entire Agreement will continue to be valid in other jurisdictions.

(g) Waivers.

No failure or delay by either the COMPANY or the EMPLOYEE in exercising any right or remedy under this Agreement will waive any provision of the Agreement. Nor will any single or partial exercise by either the COMPANY or the EMPLOYEE of any right or remedy under this Agreement preclude either of them from otherwise or further exercising these rights or remedies, or any other rights or remedies granted by any law or any related document.

(h) Captions.

The headings in this Agreement are for convenience only and do not affect this Agreement’s interpretation.

(i) Entire Agreement.

This Agreement supersedes all previous and contemporaneous oral negotiations, commitments, writings and understandings between the parties concerning the maters in this Agreement, including without limitation any policy or personnel manuals of the COMPANY.

(j) Notices.

All notices and other communications required or permitted under this Agreement will be in writing and will be hand delivered or sent by registered or certified first class mail, postage prepaid and will be effective upon delivery if hand delivered, or three (3) days after mailing if mailed to the address stated at the beginning of the Agreement. These addresses may be changed at any time by like notice.

(k) Legal Counsel.

Employee and the Company recognize that this is a legally binding contract and acknowledge and agree that they have had the opportunity to consult with legal counsel of their choice.

The COMPANY and the EMPLOYEE have duly executed this Agreement as of the date and year opposite their names below.

[Name of Company]


[Signature and Date]

[Printed Name of signor, Title at Company]

[Employee’s signature and Date]

[Printed Name of Employee]