Employment Contract Review in Australia: What to Check Before You Sign

You got the offer letter, the start date, and a 30-page employment contract attached as a PDF. Most candidates skim the salary and the title and sign. That is a mistake. Australian employment contracts increasingly contain clauses that constrain your career for years after you leave — restraint of trade, IP assignments, confidentiality, clawback provisions — and the time to negotiate is now, not after you have started.

Salary, super and bonus mechanics

The base salary is the easy bit. The traps are in the bonus structure (“at the absolute discretion of the company” usually means unenforceable), the superannuation calculation (must be at least 12 per cent under the Superannuation Guarantee (Administration) Act 1992), and the salary review clause (annual reviews are a process commitment, not a pay rise commitment).

Restraint of trade

Post-employment restraints — “you will not work for a competitor for 12 months in Australia” — are governed in New South Wales by the Restraints of Trade Act 1976 and elsewhere by common law (Lindner v Murdock’s Garage (1950) 83 CLR 628 and successors). The restraint must be reasonable in duration, geography and scope; anything broader is read down or struck out. Cascading restraints (24 / 18 / 12 / 6 months in concentric geographies) are common but not bullet-proof.

Intellectual property assignment

Most employment contracts assign all IP created in the course of employment to the employer — this is the default position under the Copyright Act 1968 and Patents Act 1990 anyway. But broader clauses (“all IP created during the term of employment”) can capture personal projects, side ventures, and pre-existing work. Always carve out pre-existing IP and (where you have a side hustle) personal projects.

Confidentiality and non-disclosure

Confidentiality obligations survive termination and are enforceable indefinitely under common law and statute. The clause should be reciprocal where possible, define “confidential information” precisely, and exclude information that is or becomes public through no fault of yours.

Notice periods

Both you and the employer must give notice on termination — typically 4 to 12 weeks for senior roles. The National Employment Standards (Fair Work Act 2009) prescribe minimum notice from the employer based on length of service; your contract can require more from you. Beware of one-sided clauses that give the employer the right to terminate immediately while requiring you to give 12 weeks notice.

Probation periods

Probation periods of up to 6 months (or 12 months for small business employers) limit your unfair dismissal protections under the Fair Work Act. The contract may set a shorter probation; check it matches what you were told verbally.

Garden leave

A garden leave clause lets the employer pay you to stay home during your notice period — denying you access to clients, systems and colleagues. This is increasingly common for senior and sales roles and effectively extends restraint of trade by stealth. Always cap the garden leave duration.

Clawback and bond clauses

Clauses requiring you to repay sign-on bonuses, training costs, or relocation expenses if you leave within a defined period are enforceable but must reflect the employer’s actual loss; penalty clauses are void. Always negotiate a sliding scale (full repayment in year 1, half in year 2, none thereafter).

What Claim Done delivers

For a flat fee, Claim Done’s Contract Review parses your employment contract against the Fair Work Act, restraint-of-trade authorities and common-law principles, and returns an A4 PDF with good, fair and watch points, key obligations, fees and penalties found, and questions to raise with the other side.

What happens after

Armed with the review, you push back on the worst clauses before signing. Even where they refuse, you signed knowing what you signed — and you have a record for later.