Monday, May 18, 2009


Employment is a contract between two parties, one being the employer and the other being the employee. An employee may be defined as: "A person in the service of another under any contract of hire, express or implied, oral or written, where the employer has the power or right to control and direct the employee in the material details of how the work is to be performed." 

In a commercial setting, the employer conceives of a productive activity, generally with the intention of generating a profit, and the employee contributes labour to the enterprise, usually in return for payment of wages. Employment also exists in the public, non-profit and household sectors. To the extent that employment or the economic equivalent is not

Becoming an employee

Most individuals attain the status of employee after an interview with a company. If the individual is determined to be a satisfactory fit for the position, he or she is given an official offer of employment within that company for a defined starting salary and position. This individual then has all the rights and privileges of an employee, which may include medical benefits and vacation days. The relationship between a corporation and its employees is usually handled through the human resources department, which handles the incorporation of new hires, and the disbursement of any benefits which the employee may be entitled, or any grievances that employee may have.


There are differing classifications of workers within a company. Some are part-time and some are full-time and permanent and receive a guaranteed salary, while others are hired for short term contracts or work as temps or consultants. These latter differ from permanent employees in that the company where they work is not their employer, but they may work through a temp-agency or consulting firm. In this respect, it is important to distinguish independent contractors from employees, since the two are treated differently both in law and in most taxation systems. In the United States, employers are required to withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. Employers generally do not pay or withhold payroll taxes on payments to independent contractors.

Many companies further classify employees as exempt or non-exempt. This designation is used to separate employees that are eligible for overtime from those that are not. An exempt employee is one that is typically salaried and is not eligible to earn overtime. Non-exempt employees are typically paid hourly and are eligible for overtime pay.


Employees can organize into trade unions or labor unions, who represent most of the available work force in a single organization. They utilize their representative power to collectively bargain with the management of companies in order to advance concerns and demands of their membership.

Ending employment

An offer of employment, however, does not guarantee employment for any length of time and each party may terminate the relationship at any time. This is referred to as at-will employment. In some professions it is customary to offer 2 weeks notice when resigning for a job. However, leaving two weeks notice may not be legally enforceable.