Employment contracts and policies exist for two moments: the ordinary one, where they tell people what has been agreed, and the difficult one, where they determine what you can and cannot do. Most employers write them for the first and discover in the second that the document does not say what they assumed.
Requirements differ by jurisdiction, so what follows is about structure and judgement rather than the specific rules that apply to you.
What a contract needs to cover
The essentials appear in almost every jurisdiction's requirements in some form:
The parties, the start date, and whether employment is ongoing, fixed-term or casual. The job title and a description of duties. Place of work, including whether it may change and what remote or hybrid working actually means in practice. Hours, including whether they are fixed or variable and how overtime is treated. Pay, including rate, frequency, and any bonus or commission with the mechanics of how it is calculated. Leave entitlements. Notice periods on both sides. Any probationary period and what happens at the end of it. Reference to the policies that apply.
Then the clauses that only matter when something goes wrong, which is precisely when you cannot add them:
Confidentiality. What is confidential and what the obligation survives.
Intellectual property. Who owns work created during employment. Frequently missing and expensive when it is.
Post-employment restrictions, where they are enforceable in your jurisdiction. These are heavily regulated and vary enormously: some jurisdictions enforce reasonable restraints, others void them entirely, and several have moved against them recently. A restriction copied from another country's template is commonly unenforceable and occasionally counterproductive.
Deductions, where and how you may make them, which is tightly controlled in most jurisdictions.
Variation. How terms may change and what requires agreement.
Why templates cause problems
A downloaded contract template is not neutral. It carries the assumptions of the jurisdiction it was written for and the situation it was written for.
Three specific failure modes:
It does not match the jurisdiction. Notice provisions, restraint clauses, leave entitlements and termination rules differ fundamentally. A clause that is standard in one country can be void or unlawful in another.
It does not match the arrangement. A template for a salaried full-time employee applied to a part-time or shift-based worker will be wrong about hours, overtime and entitlement, and those are the terms most likely to be disputed.
It references policies you do not have. Templates routinely refer to a disciplinary procedure, a grievance procedure and a handbook. If those do not exist, the contract is describing obligations you are not meeting.
The related failure is the opposite: pulling policies into the contract. A policy referenced in a contract may become a contractual term, meaning you cannot change it without agreement. Keep policies outside the contract and say explicitly that they are not contractual, where your jurisdiction permits that.
The policies you actually need
The instinct at a certain size is to produce a large handbook. Resist it. A long handbook nobody has read is a liability, because it creates obligations you will not consistently meet, and inconsistent application is where claims begin.
Start with the ones that are either required or that you will genuinely need:
Disciplinary and grievance procedures. Required or effectively required in most jurisdictions, and the ones you will regret not having. A dismissal without a followed procedure is very difficult to defend.
Health and safety, which is a statutory obligation nearly everywhere and is role-specific.
Anti-discrimination, bullying and harassment. Necessary for the obligation itself and frequently relevant to the defence available to you if something happens. Several jurisdictions have introduced positive duties to prevent, which raises the bar from having a policy to demonstrating action.
Leave, covering each type, notice, approval and evidence requirements.
Data protection, including an employee privacy notice explaining what you hold and why.
Acceptable use of technology, covering company systems, devices and any monitoring, which must be disclosed.
Then, as they become relevant: remote and hybrid working, expenses, performance management, whistleblowing, and anything specific to your industry.
Write policies you will actually follow
The test for any policy: will we do this, every time, including when it is inconvenient?
A disciplinary policy promising three written warnings before dismissal means three written warnings, including for someone whose conduct warrants immediate action. A policy is a commitment, and departing from your own stated process is one of the most common reasons employers lose cases they would otherwise have won.
So write the minimum you will keep. Build in discretion where you need it. Where a process should vary by seriousness, say so explicitly rather than describing a single path.
And give managers the short version. Most policy failures are managers who did not know the policy existed, and a twelve-page procedure guarantees that. A one-page summary of what to do and who to call prevents more problems than the full document.
Keeping them current
Documents go stale in three ways: the law changes, your practice changes, and your organisation changes.
Review annually, and additionally when you enter a new jurisdiction, when there has been legislative change, when your working arrangements change materially, and after any incident that revealed a gap.
Record acknowledgements. A policy nobody can be shown to have received is difficult to enforce. Do it at onboarding and again at each material update, with the record attached to the employee file.
Keep the history. When a dispute concerns something that happened two years ago, the version that applied then is what matters, not the current one. This is a good reason to hold documents in a system with version history rather than in a shared drive where they are overwritten.
HRM8's HRMS includes a document and template builder for generating contracts and letters with merge fields and conditional clauses, routing them for internal approval, sending for signature and keeping the signed version against the employee record. HR Services covers drafting the underlying documents, with experienced consultants owning the output.
Common questions
What must an employment contract include?
Requirements vary by jurisdiction, but consistently: parties, start date, job title and duties, place of work, hours, pay, leave, notice periods, probation and reference to applicable policies. Add confidentiality, intellectual property and any enforceable restrictions.
Can you use a template employment contract?
As a starting structure, cautiously. Templates carry the assumptions of another jurisdiction and another arrangement, and the clauses that matter most in a dispute are the ones most likely to be wrong.
Which HR policies are legally required?
It varies. Commonly required or effectively required: health and safety, disciplinary and grievance procedures, anti-discrimination and harassment, and data protection. Check what applies to you.
Should policies be part of the employment contract?
Generally not. A policy incorporated into the contract may become a contractual term you cannot change without agreement. Keep them separate and say they are non-contractual where your jurisdiction allows.
How often should contracts and policies be reviewed?
Annually, and whenever the law changes, you enter a new jurisdiction, your working arrangements change materially, or an incident reveals a gap.
Write the contract to cover the moment it goes wrong, keep policies out of the contract so you can change them, write only the policies you will follow every time including when it is inconvenient, give managers a one-page version, and keep the version history because disputes are always about the past.