A combination of experience and helpful new technology can make contract management quite straightforward if you know what you’re doing and, importantly, the pitfalls to watch out for. With that in mind, below is a working contract management guide for HR managers now and well into the future, based on principles that apply across industries and at companies of all sizes.
Learn and Use Contract Management Software
As with all business functions, HR is increasingly subject to digital transformation. New digital tools and software are making it easier for HR managers to do their jobs, and this includes the realm of contract management. Contract management software helps HR managers in a number of important ways, including freeing them up from the more tedious aspects of contract management and allowing them to be more personal in their dealings with employees.
This software streamlines the contract management process to allow for quicker addressing and handling of contract grievances and lets both employer and employee know of upcoming contractual deadlines and changes.
Social Media Conduct Clauses
Social media conduct clauses are increasingly common parts of contracts signed between employers and employees, and for a good reason. Employees frequently post about sports, politics, religion, sexuality and often do so with the explicit indication on their social media profiles that they work for a particular company. The association between employee and employer here has a lot of potential for creating PR blunders and, depending on the content of their social media posts, media firestorms.
For this reason, it is important to iron out what constitutes acceptable social media behaviour from employees in contractual documents so that there are no surprises and ample information for both employer and employee. Social media clauses can also address good data management practices so that data leaks are avoided. Keep in mind that the monitoring of employee social media accounts raises a number of important ethical considerations.
Have an Escape Route
What this means is that HR managers should ensure that contracts reflect the reality that relationships can deteriorate and, in some cases, completely unravel over time. It is a good idea to lay out all of the various situations and events that could lead to the end of a contractual relationship. This provides peace of mind for both employer and employee, as you are letting a candidate know upfront before they sign the contract the things that can lead to annulment.
Having these also protects the employer from legal action and gives them a stronger legal grounding in the event that a disgruntled employee who clearly violated the terms of their contract or is unsatisfied about the way their relationship with an employer ended decides to take legal action.
Stay on Top of Contractual Obligations
Good contract management involves not only a lot of forethought and planning before signing a contract, but a continual effort to ensure that employee conduct is in keeping with contractual obligations. Doing this makes sure the company is adhering to its contractual obligations and also looking out for its own best interests. It is a good idea to make any unfulfilled contractual obligations part of performance reviews and, importantly, to provide employees with actionable ways they can correct their performance or behaviour in ways that bring them back in line with contract fulfilment.
Pay Attention to Contract End Dates
It is important to always remember as an HR professional that contracts have end dates. It is all too common for people to sign a contract and then archive and forget about it, ignoring the fact that it is not meant to be in effect forever. Having firm start and end dates on contracts reflects not only the impermanence of employment but also the fact that employment relationships change over time. Junior employees that come in with little experience can end up becoming top performers that add tremendous value to the organization, and they will inevitably want to negotiate higher salaries for themselves, better benefits and vacation packages, etcetera.
It is also important to stay on top of contract end dates because employees providing services to employers out of contract can be major liabilities, especially as it pertains to health and safety.
Conclusion
Contract management is a fundamental part of an HR manager’s job and it is something that should be approached methodically to ensure both the company and its employees understand and do not run afoul of each other. Thanks to new contract management software and technology, designing and managing contracts is now easier than ever, but the above, like anything, still requires reminders and practice to get right.