MAKE YOUR FREE Senior employment contract

A senior employment contract, also known as an executive employment contract is a contract between a senior employee or director/executive and an employer. It outlines the terms and conditions of employment and covers all the required areas of employment contracts as well as offices and directorships, payment in lieu of notice, garden leave, confidentiality and post-termination restriction. 

Make sure you are legally compliant when you hire a senior employee or appoint an executive director with this senior employment contract. Every employer is legally required to formally outline the terms and conditions of employment for a new employee. Senior employees and executive directors will likely have more responsibility than your average employee and will be privy to more confidential information, so use this document to add extra detail and security. 

This document is GDPR compliant.

Use this executive employment contract or directors service contract:

• for senior employees
• to appoint an executive director
• for employees where you want to include more comprehensive employment terms
• only for employees based in England, Wales or Scotland.

This senior employment contract template covers:

• the duties of the role and how much they can be changed
• restrictions on outside activities and other work
• pay, expenses and bonuses
• benefits
• holidays
• hours of work
• place of work
• offices and directorships
• sickness and injury of employees
• disciplinary and grievance procedures
• arrangements for ending employment (including the option to make employment for a fixed-term)
• payment in lieu of notice and garden leave
• information required by law about trade unions and any contracting-out certificate for pensions purposes
• confidentiality, intellectual property, data protection and post-termination restrictions

You need a senior employment contract when you hire a person for a senior position within your company (eg a director or an executive).

Employers are legally required to give employees (including senior employees) a written statement of particulars on the first day of their employment. This senior employment contract complies with the requirement for a written statement. Employment contracts must be compliant with the Employment Rights Act 1996, the Employment Act 2002 and the Equality Act 2010.

A senior employment contract is more complex than a regular employment contract. This is because a senior employee is more likely to be exposed to confidential information and have more responsibility. This document includes extra clauses which help to protect these interests. These include clauses on:

Garden leave

Putting a garden leave clause in an employment contract gives the employer the right to require the employee to stay at home during their notice period to protect the employer's business by keeping the senior employee out of the office. The purpose is to limit contact with employees and access to confidential information and therefore, prevent them from working for another employer or setting up in a competing business.

Post-termination restrictions

These are contract clauses prohibiting employees from doing a specific thing after their employment ends, eg they must not join a competitor (non-compete), poach other employees or solicit customers. For more information, read Post-employment restrictions.

Share options

These are benefits in the form of an option given by a company to an employee to buy shares in the company at a discount or at a stated fixed price.

Other employee benefits

These could include benefits such as a bonus, reimbursement for expenses without advance permission (you can specify the maximum amount in this agreement) or life and health insurance.

Notice periods for directors or senior employees range from one month to three months but can be anytime from six up to twelve months. It is up to the employer to decide the notice period, however, is subject to the statutory minimum. It is normal but not compulsory to have a notice period greater than the statutory minimum for senior employees.

This document gives you the right to transfer employee data out of the UK or EEA. However the employer can only transfer personal data outside of the UK or EEA if there are appropriate safeguards in place, eg the organisation receiving the data is certified under an approved certification mechanism. Such safeguards should be set out in the employer's Data protection policy. For further information, read International transfers of personal data. 

Ask a lawyer for:

• appointing senior employees or directors of a company whose shares are listed on a stock exchange
• appointing employees based outside England, Wales or Scotland.