Can a Verbal Employment Agreement be Legally Binding in New Jersey?

In New Jersey, verbal employment agreements can be binding and enforceable, although they may pose challenges in terms of proof and interpretation compared to written agreements. New Jersey follows the principle of “employment-at-will,” which means that absent a written contract or specific legal protections, an employer or employee may terminate the employment relationship at any time, with or without cause.

What is a Verbal Employment Agreement?

A verbal employment agreement, also known as an oral employment agreement, is a type of employment contract that is based on spoken communication rather than a written document. It is a mutual agreement between an employer and an employee regarding the terms and conditions of employment.

What Makes a Verbal Agreement Legally Binding?

Verbal employment agreements are very difficult to enforce.  However, verbal agreements can still establish contractual obligations and terms, especially if they meet the basic elements of a contract, such as an offer, acceptance, consideration, and a mutual intent to be bound. New Jersey recognizes both express and implied contracts, meaning that an employment agreement can be formed through explicit verbal statements or through the parties’ conduct and actions.

Why You Should Always Have a Written Contract 

Having a written employment contract in New Jersey is highly advisable for many reasons.  A written employment contract provides clarity and certainty regarding the terms and conditions of employment.  A written contract specifies the agreed-upon compensation, benefits, bonuses, and other forms of remuneration. This eliminates potential disagreements and ensures that both parties are on the same page regarding financial arrangements.

Additionally, a written contract allows for customization to meet the specific needs and circumstances of the employer and the employee. It can address unique aspects of the employment relationship and accommodate individual considerations.

Work With a New Jersey Employment Attorney

In today’s economic environment, it is very common for employers to present employees with various types of agreements that attempt to protect their business interests and/or insulate them from potential liability.  The most common agreements presented to employees are employment agreements, restrictive covenant agreements (including non-compete, non-solicitation, and confidentiality agreements), and severance agreements. Accordingly, it is important for employees to retain legal counsel before entering into any such agreements to ensure they fully understand the terms and conditions of any such agreements, including any post-employment obligations. If you need any assistance with employment agreement-related issues, please contact Curcio Mirzaian Sirot LLC.