Employment Agreement Template for the US: Clauses and Law That Apply (2026)

What is a US employment agreement, and when do you need one? A US employment agreement is a contract between an employer and an employee that sets the job, the pay, and the terms of the working relationship. In the United States most jobs are "at-will," which means either side can end the relationship at any time, for any lawful reason, with or without notice. Because of that, many US employers use a short offer letter rather than a long contract. A full employment agreement is worth using when the role involves confidential information, intellectual property, equity, a defined term, or terms the parties want in writing and hard to change. This article is general guidance, not legal advice. Employment law in the US is a mix of federal law and the law of the state where the employee works, and it changes, so have a qualified professional review any agreement before you rely on it. Last verified October 2026. ## US employment agreement template Copy the block below and fill the bracketed fields. ```

EMPLOYMENT AGREEMENT This Employment Agreement ("Agreement") is made on [DATE] BETWEEN: [COMPANY NAME], a [STATE] [entity type] ("Company") AND [EMPLOYEE NAME], of [address] ("Employee") 1. POSITION AND DUTIES The Company employs the Employee as [JOB TITLE], reporting to [ROLE]. The Employee will perform the duties of the role and other reasonable duties assigned. 2. START DATE AND AT-WILL STATUS Employment begins on [START DATE] and is at-will. Either party may end the employment at any time, for any lawful reason, with or without cause or notice, except as a written agreement signed by [OFFICER] states otherwise. 3. COMPENSATION The Company will pay a [salary of [AMOUNT] per year / wage of [AMOUNT] per hour], paid [schedule], subject to lawful withholdings. The role is classified as [exempt / non-exempt] under the Fair Labor Standards Act. 4. BENEFITS The Employee is eligible for the Company's benefits as they exist from time to time, subject to each plan's terms. [List or reference handbook.] 5. CONFIDENTIALITY The Employee will keep the Company's confidential information secret during and after employment and use it only for the Company's benefit. 6. INTELLECTUAL PROPERTY Work product the Employee creates within the scope of employment belongs to the Company. The Employee assigns such rights to the Company and will sign documents needed to record them, subject to any state law that limits assignment of inventions made on the Employee's own time. 7. RESTRICTIVE COVENANTS [Non-solicitation of customers and employees for [N] months after employment.] [Any non-compete is subject to the law of the governing state and may be unenforceable or banned there; see note below.] 8. GOVERNING LAW This Agreement is governed by the laws of the State of [STATE]. 9. ENTIRE AGREEMENT This Agreement and the documents it refers to are the entire agreement and replace earlier discussions and offers. Signed for the Company: __________ Employee: __________ Name / title / date Name / date

- **Compensation and FLSA class (clause 3).** Say the pay and the schedule, and classify the role as exempt or non-exempt under the Fair Labor Standards Act. Non-exempt employees must get at least the federal or state minimum wage and overtime for hours over 40 in a week. Misclassifying an employee as exempt is a common and costly error.
- **Confidentiality and IP (clauses 5 and 6).** These are the main reasons to use a full agreement rather than just an offer letter. Keep the IP assignment within the scope of employment and note that some states limit assignment of inventions an employee makes on their own time with their own resources.
- **Restrictive covenants (clause 7).** Non-solicitation terms are more widely enforceable than non-competes. Non-competes are governed by state law and their enforceability varies sharply; see the jurisdiction note. ## Common mistakes to avoid - Language that undercuts at-will status, such as promising a fixed term or "ongoing" employment, when you meant the role to be at-will.
- Misclassifying a non-exempt worker as exempt and skipping overtime.
- Copying a non-compete from another state without checking whether it is enforceable where the employee works.
- No clear IP assignment, so ownership of work product is unclear.
- Treating an offer letter and an employment agreement as the same thing; an offer letter is usually shorter and may not cover IP or confidentiality. ## A note on jurisdiction and current law - **At-will employment.** All US states except Montana use at-will employment as the default. Montana's Wrongful Discharge from Employment Act requires good cause to fire an employee after a probationary period. Check the current statute for details. <!-- [VERIFY: Montana WDEA probationary period length varies across sources; confirm Mont. Code Ann. 39-2-901 et seq.] -->
- **Federal floor.** The Fair Labor Standards Act sets minimum wage, overtime, and exempt/non-exempt rules. Employers must also complete Form I-9 to verify work authorization, and follow federal anti-discrimination laws.
- **State law on top.** State wage, leave, and final-pay rules sit on top of the federal floor and often give employees more. Classification of exempt roles can be stricter in some states.
- **Non-competes.** The Federal Trade Commission issued a rule in 2024 that would have banned most non-competes, but a federal court vacated the rule nationwide in 2024, and the FTC dropped its appeals in 2025. As of 2026 non-compete enforceability is governed by state law. California, Minnesota, North Dakota, and Oklahoma broadly ban employee non-competes, while other states enforce reasonable ones. The FTC held a workshop in January 2026 signalling it may revisit the issue, so confirm the current position before relying on a non-compete. <!-- [VERIFY: outcome of FTC January 2026 non-compete workshop and any new rulemaking; state bans list current as of October 2026] --> Last verified October 2026. ## Where a contract workspace helps A template gets you a sound US employment agreement, but the ongoing work is keeping terms consistent across every hire, getting each role's exempt or non-exempt classification and state-specific clauses right, and keeping signed versions straight as the team grows. Drafting US employment agreements this way, with at-will wording and FLSA classification checked as you go and a record of who signed what kept in one place, is what a single AI workspace tuned to your company is for. [Adira](https://adiralaw.com) is one workspace built for US hiring this way. The template alone is enough to put a fair agreement in place.