Employee Retention Agreement Templates: What You Need to Know in 2023

What is an Employee Retention Agreement?

An employee retention agreement is a legal document that outlines the terms and conditions under which an employer and employee agree to continue their relationship. It is typically used when an employee has been offered a promotion or increased benefits, or is being asked to stay with the company for an extended period of time. It helps both parties understand the expectations and responsibilities that are involved in the agreement.

Why do Companies Use Employee Retention Agreements?

Employee retention agreements are used to ensure that both parties are protected in the event that the employee decides to leave the company. The agreement serves to protect the employer by outlining the conditions under which the employee will stay with the company, such as a specified period of time or the completion of certain tasks. It also helps protect the employee by outlining what benefits they will receive in exchange for their continued employment.

Benefits of Using an Employee Retention Agreement

Using an employee retention agreement can help both parties in a variety of ways. It can help employers retain key employees and provide incentives for them to stay with the company. It can also help to protect the employer from any potential legal issues should the employee decide to leave the company. Additionally, it can provide employees with the security of knowing that their job is secure for an extended period of time.

Sample Employee Retention Agreement Templates

Template 1: Standard Employee Retention Agreement

This agreement is between [Employer Name] and [Employee Name] and outlines the terms and conditions of the employee’s continued employment. The agreement is effective as of [Date], and will remain in effect for a period of [number] of years. During that period, [Employee] agrees to continue working for [Employer], and [Employer] agrees to provide [Employee] with [benefits]. Both parties agree to the following terms and conditions:

• Both parties agree to the terms and conditions outlined in this agreement.
• Employee agrees to work for [Employer] for the duration of the agreement.
• Employer agrees to provide [Employee] with [benefits] in exchange for continued employment.
• The agreement may be terminated at any time by either party, with [amount of time] notice.
• The agreement may be amended at any time, with both parties’ consent.

Template 2: Performance-Based Employee Retention Agreement

This agreement is between [Employer Name] and [Employee Name] and outlines the terms and conditions of the employee’s continued employment. The agreement is effective as of [Date], and will remain in effect for a period of [number] of years. During that period, [Employee] agrees to continue working for [Employer], and [Employer] agrees to provide [Employee] with [benefits]. Both parties agree to the following terms and conditions:

• Both parties agree to the terms and conditions outlined in this agreement.
• Employee agrees to work for [Employer] for the duration of the agreement.
• Employer agrees to provide [Employee] with [benefits] in exchange for continued employment.
• The agreement may be terminated at any time by either party, with [amount of time] notice.
• The agreement may be amended at any time, with both parties’ consent.
• Employee must meet certain performance thresholds, as outlined in the agreement, to remain employed.

Template 3: Long-Term Employee Retention Agreement

This agreement is between [Employer Name] and [Employee Name] and outlines the terms and conditions of the employee’s continued employment. The agreement is effective as of [Date], and will remain in effect for a period of [number] of years. During that period, [Employee] agrees to continue working for [Employer], and [Employer] agrees to provide [Employee] with [benefits]. Both parties agree to the following terms and conditions:

• Both parties agree to the terms and conditions outlined in this agreement.
• Employee agrees to work for [Employer] for the duration of the agreement.
• Employer agrees to provide [Employee] with [benefits] in exchange for continued employment.
• The agreement may be terminated at any time by either party, with [amount of time] notice.
• The agreement may be amended at any time, with both parties’ consent.
• Employee must remain employed with [Employer] for the duration of the agreement.
• Employee may not accept employment with another company without prior written consent from [Employer].