When an employee begins work for a new employer, it is likely the employee will be asked to sign an employment agreement. A Texas employment contract acts as a guide to inform both the employee and employer of the other’s rights and obligations. Typically, an employment contract will include the terms of employment and the expectations of each party, as well as the available remedies if either party breaches the contract.
If an employee does not critically examine his or her agreement until after a problem arises, the employee may find themselves in a position where they are bound by what seems to be an unfair contract. For example, it may be that an employee discovers they are required to submit their claim through the arbitration process rather than pursue a claim in a court of law. Thus, the question often arises as to whether a Texas employment contract is enforceable.
Generally, Texas employment contracts are enforceable so long as they comply with the rules of contract formation. Simply stated, this means that a contract must be based on a mutuality of consent, involve the exchange of mutual consideration, and cannot be based on illegal activity. In addition, a contract is only valid if the parties have the mental and legal capacity to enter into the contract. However, even a contract that was validly formed can be deemed unenforceable by a court if the contract is unfair or one-sided.