Contract of Service

Posted in Marketing and Strategy Terms, Total Reads: 1353

Definition: Contract of Service

Contract of service is an agreement which establishes employee-employer relationship between two parties. The agreement can be verbal or written, expressed or implied.

In Contract of service,

  • One party agrees to serve the employer as an employee
  • Other party agrees to employ him as an employee

In nutshell, any employment contract is a contract of service. However it is not same as the contract for service.

In contract of service, employer has the direct control over employee on how duties should be carried out. Employee must perform his duties according to job description.

A contract of service must have following clauses.

  • Commencement of employment;
  • Appointment – job title and job scope;
  • Hours of work;
  • Probation period, if any;
  • Remuneration; - Right of the Employee
  • Employee's benefits – Right of the employee
  • Termination of contract – notice period; and
  • Code of conduct

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