Alabama Employment Contract Templates

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Alabama employment agreements are used to establish a relationship between an employer and another party for the payment of services. Depending on the type of employment relationship, the party performing the service may either be an employee, an independent contractor, or a subcontractor. An agreement is important for establishing a payment plan for services rendered, but it can also protect the employer through the inclusion of non-disclosure, non-compete, and liability clauses.

LawsTitle 25, Chapter 4 (Unemployment Compensation)

Table of Contents

By Type (4)


Employee Non-Disclosure Agreement (NDA) – Withholds an employee from being able to disclose or use employer’s information for their own benefit.

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Employee Non-Compete Agreement – Prohibits an individual from being able to work for competitors or start their own business in the same (or similar) market.

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Independent Contractor Agreement – Allows an individual or business to provide services for payment as a 1099 independent contractor.

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Subcontractor Agreement – Contract made between a company that uses another’s services to complete a project.

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What is an Employee?

“Employee” Definition§ 25-4-7

“. . . means any individual employed by an employer subject to this chapter, in which employment the relationship of master and servant exists between the employee and the person employing him.”

At-Will Employment

Allowed with the exception of any “Implied Contracts” and “Good-Faith” understandings.

Income Tax Rate (Individual)

Individual Income Tax – 2% to 5% (§ 40-18-5)

Minimum Wage ($/hr)

Minimum Wage – $7.25 (no State minimum, federal law applies)

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