How Much Does An Employment Contract Cost?

If your organization is considering creating employment contracts for your workers to sign, congratulations, that is a sound business decision. But how much will creating an employment contract for your business cost?

The Cost of a Lawyer to Draft an Employment Contract

Traditionally, the only way to get an employment contract done right was with a lawyer. Lawyers are not cheap. The average price of a lawyer is around $500 per hour. There is a wide range - junior lawyers at small firms will charge less, and senior lawyers at large firms will charge more. But the average is about $500 per hour.

A lawyer's draft of a standard employment contract takes about one hour. It takes only an hour to draft a standard employment contract because the lawyer will create it from a pre-created template in the firm's database. The lawyer will not be reinventing the wheel.

It would help if you avoided a lawyer who says drafting your company a basic employment contract will take many hours because that means the lawyer will be drafting the employment from scratch, which is a waste of your money and may indicate the lawyer has never created an employment contract before. He or she should have a boilerplate.

However, it is essential to note that your first employment contract with a lawyer may cost more than an hour of labour. First, only a few lawyers will take on a client with only one hour of work. Second, the lawyer must consult with you about your business and workforce. Following this early consultation, emails and calls will be billed at a minimum of 0.1 of an hour, which adds up quickly. You should expect your first employment contract with your new lawyer to cost at least three hours of legal work.

After that, once you have a relationship with a lawyer, for every new employment contract, with slight changes for variables in the role, seniority, level, etc., it will likely cost around one hour in total to create each new version of the contract, including likely forty minutes on drafting the document in Word and twenty minutes on responding to emails from you.

In sum, it should cost your business about $1,500 for a lawyer to create a first employment contract and about $500 for every employment contract (from the same boilerplate with modest changes) thereafter.

Now, if your organization needs employment contracts for niche roles and more senior positions, the price will go up. A first iteration of a basic employment contract with standard terms and conditions is about three hours of labour, as discussed above. However, for example, a contract for a commission-based salesperson or a c-suite executive will be more expensive than a traditional employment contract for a standard salaried employee because those contracts should include complicated and customized terms and conditions.

The Cost of Making an Employment Contract Yourself

Drafting your own employment contract for your business costs you nothing but your time. Just kidding, it could eventually cost you a lot of money.  

People who aren't lawyers do not know how to draft employment contracts.

In my experience as an employment lawyer for about ten years acting on behalf of employee plaintiffs, I could instantly tell if the employer created the employment contract by themselves or copied it from the internet (adding their own text to the boilerplate).

They inserted into the contract language that sounded lawyer-like (gibberish legalese) but the text was clearly void, and they had spelling, grammatical and formatting mistakes everywhere.

This is not to say you will insert legalese and typos into your do-it-yourself employment contract, but you likely still need to learn how to draft a proper clause or two that won't be held unenforceable in court. The fact is, there are many, many, many ways your text could be found to be void by a court, making the contract useless and very expensive in the end.

Cost To Use goHeather To Make Your Employment Contract.

goHeather is an alternative to hiring a lawyer to draft your employment contract or completing one by yourself.

goHeather automates employment contracts. With goHeather, you can build an employment contract in five minutes by filling out a form. Your output will be inserted into the goHeather local lawyer-made template to complete your contract.

It costs $89.99 to make a goHeather employment contract. goHeather employment contracts are local and lawyer-made, and our goal is to help small and medium-sized businesses avoid unneeded liabilities. Use goHeather to save money on upfront legal costs and legal damages down the road.