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Written and implied business contracts: What is the difference?

When entering into a business agreement in Kentucky, contracts can be essential. There are different types of contracts. Some are written while others are implied. Knowing the difference is important as there are different ramifications for each.

Written employment contracts vs. implied employment contracts

Contracts – whether written or implied – can help navigate the complex terrain of doing business. For employees and employers alike, understanding how they differ is critical. A written employment contract will lay out how the employer-employee relationship will work, what the duties are and list all benefits. Frequently, an overlooked part of a written employment contract is what the employee can do when he or she leaves. For example, the employee might not be allowed to go to work for a direct competitor.

The implied employment contract will not have specific details in written form. Instead, it will be based on statements that were made during discussions between the employee and employer. This can take place in an interview or when a person is given new duties to perform. If, for example, an employee is shifted from a subordinate role to a supervisory role, it is to be expected that there will be enhanced pay and benefits. The work itself could suggest that it will last for a certain amount of time. A construction project is a job where a worker could reasonably expect to be on the job until it is completed. From both perspectives, ongoing business advising could be useful to handle any contract-related concerns.

Knowing the variables in these contracts can be helpful

Some points are easier to prove in a written employment contract because the details are on paper. An implied contract might turn into a back and forth, but there are ways to show that it is valid and certain requirements should have been met. When coming to an agreement, it is useful to have a grasp of the difference between contracts and proceed accordingly, especially if there is a dispute.