I have been asked to sign a new employment contract – do I have to?

Your employer has just handed you a new contract. Maybe they say it’s routine, or that it simply reflects changes in the law. But before you sign, there are a few things you should know.

The short answer: no, you don’t have to sign.

A contract is a bilateral agreement. Your employer cannot force you to sign a new one, and they cannot legally coerce you into doing so. Under the Fair Work Act 2009, using threats, intimidation or pressure to make an employee sign a new contract is prohibited. If that happens, you may have grounds to make a claim with the Fair Work Commission.

So why do employers ask?

There are legitimate reasons – a business restructure, changes to the National Employment Standards, or updates to reflect a new role. But not all contract changes are in your favour, and “it’s just paperwork” is not always true.

What should you look out for?

Before signing anything, check whether the new contract:

• reduces your pay, hours or leave entitlements
• changes your employment from permanent to fixed-term or casual
• introduces a restraint of trade or non-compete clause
• changes the entity you are employed by
• adds confidentiality or intellectual property obligations that weren’t there before

No employment contract can provide fewer rights than those guaranteed under the National Employment Standards. If the new contract attempts to undercut those minimums, it is not enforceable – but that does not mean you should sign it without advice.

What should you do?

Ask your employer to explain exactly what has changed and why. Request the changes in writing before you respond. Do not feel pressured to sign on the spot – you are entitled to take reasonable time to seek legal advice.

If something does not look right, get advice before you sign. It is much easier to negotiate changes before you have agreed to them.

Not sure about a contract you’ve been asked to sign?

Our employment law team can review it with you. Call us on 1300 529 444 for 24/7 legal assistance, or visit fourtreelawyers.com.au.

This article is intended as general information only and does not constitute legal advice. For advice specific to your circumstances, please contact a qualified employment lawyer at Fourtree Lawyers.