Employment agreement and contract: what is the difference? Main differences between legal acts in content

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Published: 08/13/2018

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For an ordinary person, it is not at all shameful to confuse an employment contract and an employment agreement. But when hiring, knowing the differences between these acts can literally decide your fate as an employee.

The thing is that an employment contract and an employment agreement are concepts from different areas of law and they regulate a different range of relations.

Employment contract - what is it?
Employment agreement - concept and features
Differences between an employment contract and an agreement

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Labor contract

This is a type of contract , or rather its special form. This is a fixed-term agreement that has a written format. Unlike a simple obligation, the parties can specify all the essential conditions, change them or not include them. The essential conditions are special work, payment, conditions of material support, as well as termination of the relationship between employer and employee.

It is concluded only with those categories of individuals provided for by law. With other workers it is possible to conclude a regular contract. This is justified by the fact that this document reduces the level of social protection of the working population and the worker has to rely on himself.

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Pros and cons for the performer

On the part of the contractor, the advantage will be a relative form of freedom in planning time, distributing the load, attracting other labor resources; there is no need to follow job descriptions. Based on the results of completing a certain amount of work or fully rendered service, the contractor receives the remuneration specified in the agreement.

An employee has the right to work for several employers at once. With one-time short-term work, an individual is interested in completing the task and receiving payment and proceeding to the next order, without burdening himself with a long-term employment relationship.

Important! By agreeing to a civil law type of relationship, the employee, in turn, suffers a number of inconveniences, refusing social guarantees and legal protection from labor legislation.

When working under an employment agreement, there is no opportunity to go on paid leave, maternity leave, or sick leave.

Employment contract

This is an agreement between an employer and an employee , on the basis of which one party, the employee, undertakes to fulfill the duties assigned to him, as well as to comply with the work regime, and the employer to provide the necessary working conditions, as well as ensure payment of wages on time.

Legal relations can be concluded in the following
forms :

Written - the conclusion of an official document, as a rule, is carried out in this form. All rights and obligations of the parties are stated here. The agreement between the parties is printed in several copies and is kept by both parties;
The oral form involves writing a statement from the worker and issuing a written order for the enterprise. In this form, there is a general routine and instructions that the manager must introduce to the employee within a certain time.

We recommend reading: the concept of human rights and responsibilities.

Additional agreement to the contract

When it is necessary to change, add or completely remove some clauses, a new document is attached to the employment agreement - an Supplementary Agreement. However, it cannot exist separately, independently. Thus, when the contract is terminated, the additional agreement also ceases to be valid.

The additional agreement is drawn up as follows:

The heading is written in the center: “Additional agreement to agreement No. dated_ (date of conclusion of the agreement)”;
Below on the left is the city in which the additional agreement is created, and on the right is the date of its conclusion;
then write the name of the organization or the name of the customer, and below the name of the contractor;
then the points to which changes are made or new ones are written are written down;
At the end, the signatures of the two parties and the date of signing are placed.

Because in some ways the contract is similar to an agreement and the rules for concluding agreements also apply to it, then it is necessary to have it certified by a notary and stamped.

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Contract of employment

The agreement has a civil law format . An employment agreement is a civil transaction or a contract for the provision of services. Often, such relationships include contracts or work to provide services. The participants here are also different. This is the employer and contractor - the person who undertakes to complete the work on time. Fulfillment of assigned duties has a short-term, one-time, one-time format.

Employment agreement and employment contract - what is the difference? If, according to ordinary working relationships, payment is made for the work provided for in the agreement, then here, by agreement between the customer and the contractor, the final result obtained is paid for - the subject of the agreement between the participants.

Advantages and disadvantages for the employer

For an employer, there are a number of advantages of an employment agreement over an employment contract. Often there is a need to perform one-time work or provide a one-time specific service; in such a situation, the best option would be a civil contract.

It allows you to save space on the employer’s territory, and, accordingly, money, because it eliminates the obligation to create a separate workplace, the presence of which is mandatory when concluding an employment contract.

Payment of remuneration is made based on the results of the work , and first the quality, volume, and period specified in the agreement are assessed; there is no frequency of payment. There is no need to compensate for travel expenses, severance pay, sick leave, and the employer does not have to keep the job if the employee temporarily loses his ability to work.

On a note. The social package that an employee’s employment contract provides is absent in civil law relations, which significantly reduces the customer’s costs and narrows the range of responsibilities.

When formalizing relations with an individual in a civil law manner, the customer has a certain benefit in the form of the opportunity to reduce the amount of accrued insurance premiums, and sometimes there is no need to accrue them at all.

Here, remunerations are not subject to contributions for compulsory social insurance in case of temporary disability and in connection with maternity, and the amounts of income accrued to employees are not subject to contributions for insurance against accidents and industrial injuries, unless this is expressly stated in the terms of the contract.

If a GPC agreement is concluded with an individual in the status of an individual entrepreneur, then he is obliged to calculate and pay insurance premiums independently. This is due to the fact that in the light of Art. 419 of the Tax Code of the Russian Federation, private entrepreneurs are allocated to a separate class of payers ; the customer will not be a tax agent in this case.

The disadvantage of concluding such a document for the employer will be the risk of incorrect drafting and the existence of an employment relationship, which may serve as a reason for recognizing it as an employment contract, as well as penalties and litigation.

Difference in legislation

Now let’s look at the difference between these official documents from the legislative perspective:

Employment contract and employment contract - what are the differences? The contract is fixed-term and is concluded for 3–5 years . After which the employer may not renew the work. Regular employment has an open-ended basis and can only be terminated due to the liquidation of the enterprise.
The contract can be terminated at any time by notifying the employer in advance. The contract cannot be broken ; it must be worked out in full. Only when there is a question about its extension, the parties may not renew it.
The contract may stipulate additional conditions to protect the parties. This could be an increase in wages, a change in working conditions, or possible additional financial responsibility.

Legal basis

The fundamental differences between an employment contract and a civil law contract are the use of various areas of law in the process of their regulation. In particular, if this is an employment contract, then the norms of the Labor Code of the Russian Federation apply. At the same time, if you conclude a GPA, you will have to be guided by the Civil Code of the Russian Federation.

Do not forget that according to the norms of the Tax Code of the Russian Federation, in labor relations, the payment of all taxes due to the state falls on the shoulders of the employer, while in civil law relations this is the responsibility of a particular citizen.

Therefore, in labor relations, you need to be guided by:

Labor Code;
regulatory documents of the government and executive authorities arising from the norms of the Labor Code of the Russian Federation;
collective agreement;
local company documents regulating issues of remuneration, personnel records management, labor regulations, work and rest hours.

During civil legal relations, the basic documents will be:

Civil Code;
terms of the agreement between the parties.

As we can see, the list of documents for different types of relationships is significantly narrowed, as are key differences in the process of fulfillment by the parties of their obligations. It is important to note that the recognition of such relations as labor relations occurs precisely because such an agreement is subject to the conditions stipulated by regulatory documents for labor relations. In practice this is:

indefinite period of execution of orders;
periodic fixed payment for such work;
use of production means and customer premises;
existence of a work schedule during the execution of the assignment.

Social guarantees

As for guarantees for two types of conclusion of legal relations, the contract wins here. For persons working under a contract, social benefits are not provided, such as vacation pay or temporary disability benefits, unless this is specified in separate paragraphs of the document.

The agreement also does not have social benefits, because it is usually concluded one-time and regulates the receipt of work performed.

What is the difference?

The difference between an employment contract and an employment agreement is quite significant. And these differences almost always relate to employee rights.

This is used by many employers who want to reduce the guarantees and rights of their employees, as well as reduce costs. Therefore, you should definitely find out the type of employment relationship before signing the document.

Often, when applying for a job, a person is asked to enter into an employment agreement.

This decision is motivated in different ways - by a probationary period, the absence of a personnel department in the organization, or the fact that all employees enter into exactly this type of contract.

And if not everyone knows the difference between these two documents, then the majority simply does not pay attention to the paper being signed, counting on a good salary, but in vain, because a civil contract is not a guarantee either for payment of the entire promised salary or against illegal dismissal, nor from forced payments for imaginary damage.

Differences between an employment contract and a civil law contract:

the parties to the employment agreement are the customer and the contractor, while in the employment contract they are exclusively the employee and the employer;
What matters in an employment agreement is the final result, and in a labor agreement – labor responsibilities and compliance with internal regulations;
in the first case, payment occurs after completing a certain amount of work, while the employment contract provides for a certain salary several times a month;
the employment contract determines the work and rest schedule that the employee is obliged to observe;
a civil contract is usually concluded for a specific period;
labor legislation provides sufficient guarantees, while in a civil contract they may not be specified, and their compliance is quite doubtful.

For example, an employer does not have the right to hire a secretary and enter into a regular civil contract with him.

And all because this type of agreement does not provide any social guarantees and does not define the employee as a member of the staff.

In particular, it is important that the secretary is subject to internal labor regulations, follows the instructions of his immediate superior, and his work cannot be called one-time.

In court, such an employment agreement will quickly be recognized as an employment contract.

An employer has the right to hire an unlimited number of employees under a civil contract, while the number of employment contracts is limited by the organization’s staffing table.

He can also refuse to conclude an employment agreement to any candidate, and does not have to explain the reason. But in order to refuse an applicant to conclude an employment contract with him, the employer must have serious reasons (Article 64 of the Labor Code of the Russian Federation).

Another nuance that not everyone knows about is liability and damages for poor work.

An employee who has entered into an employment contract may be subject to disciplinary liability or pay the employer a fine not exceeding his monthly earnings.

How are employment contracts numbered? Find out from our article. What could be the reasons for terminating an employment contract? Read here.

How to draw up an employment contract with a disabled person? See here.

In the case of a civil contract, the employee is obliged to compensate for damage not only with a fine, but also, if necessary, to pay it in full.

Having concluded an employment agreement, an employee cannot expect:

for financial assistance;
compensation;
paid medical care;
benefits for pregnancy and child care;
directing contributions to replenish labor pensions.

You can download the Labor Code of the Russian Federation and familiarize yourself with its provisions here:

Labor Code of the Russian Federation

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conclusions

Thus, we can conclude that a contract is a specific form of obligation and has the following differences:

Duration of conclusion of legal relations;
Conditions for termination of legal relations;
Guarantee of social benefits and assistance.

Before entering into such legal relations, carefully read the documentation and delve into all the intricacies of the procedure.

Conclusion: contract and employment contract - what is the difference?

Working without a work book

When an employment agreement is concluded with a performer, this is not official employment. Consequently, the employer is not responsible for filling out and registering the work book.

Depending on the scope of work planned to be performed, the parties can draw up an agreement in the following forms:

in simple written form, including the necessary clauses, nuances and provisions in the agreement. The agreement is signed by both parties and comes into legal force. On the part of the customer, if he is not an individual entrepreneur, the document must be sealed;
can be additionally certified by a notary, although the law does not impose such a requirement. But some people prefer to play it safe.

The agreement is prepared in two copies, one for both parties. The copies of the customer and the contractor must be identical.