Employee Contract Documentation: What to Check Before a File Is Closed

A contract is the document that everything else refers to. When a dispute, an audit, or a resignation arrives, the first question is almost always: what did the contract actually say?

In file reviews I have done, contract problems are rarely dramatic. They are small omissions — a missing employer signature, a salary figure that does not match the payroll, a revision agreed by email and never documented — and each one weakens the file.

This is the checklist I run before a signed contract goes into a personnel file.

Employment contract requirements depend on Nepali labour law, the sector, and the role. This article describes documentation practice, not legal advice. Have contracts reviewed by a qualified person, and check current requirements before changing any clause.

Clauses that are commonly missing

Check that each of these appears, and that it says something specific:

1. Parties and identification — full legal name of the company, employee’s full name, address, and identification reference.
2. Position and department — job title, reporting line, and location of work.
3. Start date and probation — joining date, probation length, and how probation is confirmed or extended.
4. Working hours and days — normal hours, weekly rest, shift arrangements, and any roster system.
5. Remuneration — basic salary, allowances, payment frequency, payment method, and deductions.
6. Overtime treatment — whether overtime is paid or compensated as permitted, and how it is approved.
7. Leave entitlement — annual, sick, and other leave, with the process for applying.
8. Statutory contributions — provident fund, social security, insurance, or gratuity as applicable.
9. Duties and expectations — a summary, with reference to the job description.
10. Confidentiality and data handling — what the employee must protect and for how long.
11. Company property — what is issued and what must be returned.
12. Termination and notice — notice period for both sides, and the process for resignation.
13. Disciplinary process — reference to the policy and its stages.
14. Grievance process — who to contact and how a complaint is handled.
15. Dispute or governing terms — how disputes are handled, and which rules apply.
16. Variation clause — how changes to the contract will be made and recorded.
17. Signatures and date — both parties, with the date the contract was signed.

The five checks most often skipped

1. Both signatures. An employee-signed contract with no employer signature is a common finding. It is easy to fix and hard to explain.

2. The date. Contracts signed weeks after joining create a gap in the record. If the real joining date is earlier than the signature date, note the actual joining date separately — and fix the process, not the file.

3. Amounts matching payroll. If the contract says one figure and the salary slip shows another with no documented change, the file contradicts itself. Reconcile every revision.

4. Language the employee reads. A contract should be understood by the person signing it. Where a translation or explanation is provided, record that it happened and when.

5. The annexures. Job descriptions, policy acknowledgements, and schedules are part of the contract only if they are attached, dated, and referenced. A missing attachment is a missing clause.

Changes during employment

Salary revisions, promotions, department changes, and location transfers should all be documented — even when the relationship is good and everyone remembers the conversation.

For each change, the file should contain:

• a letter or addendum stating the change and its effective date;
• the reason, where the company records reasons;
• a revised salary or designation line showing the old and new values;
• both signatures;
• a note of any related changes, such as a revised job description or reporting line.

Email confirmations are better than nothing, but they are not a substitute for a signed addendum when the contract terms change.

Contract register: the tool that prevents surprises

Keep a simple register for the whole workforce with these columns: employee name, position, contract type, joining date, contract start and end date, probation end, renewal due date, and current salary revision date.

The register answers three questions instantly:

• Which contracts expire in the next 90 days?
• Whose probation ends this month?
• Which files have had no salary revision recorded in two years?

Review it monthly. It prevents the classic year-end scramble of renewals that were due in August.

File closure: the final review

Before closing a personnel file for a new joiner, verify:

• Contract signed and dated by both parties
• Job description attached and dated
• Personal details form completed
• ID and qualification copies verified, with the verification noted
• Policy acknowledgements signed
• Statutory registration completed where applicable
• Emergency contact recorded
• Bank and PAN details recorded securely
• Copy of the contract provided to the employee
• Entry in the contract register
• Reminder set for probation and renewal dates

Eleven items. Most of the findings I have seen in personnel files would have been prevented by this one list.

Working with fixed-term and project contracts

Fixed-term contracts need extra discipline because there are two dates that matter: the end date and the decision date.

• Record the end date in the register and set a reminder 60–90 days before.
• Decide renewal or closure in writing, with a date.
• Where a contract is renewed, issue a new contract or addendum — do not rely on continued work as evidence of renewal.
• Where the engagement is through a contractor, keep the contractor agreement, the worker list, and the documentation showing who employed the worker.

Where contract documents go

Signed originals in a locked cabinet or secure digital store, one file per employee, with scans available for daily work. Access limited to those who need it. Superseded versions archived rather than deleted — a change is easier to explain when the earlier version still exists.

A closing thought

The most expensive contract problem is not an unusual clause. It is a missing one: no signature, no date, no annexure, no record of a promised change. Those gaps cost nothing to prevent at the time and a great deal to explain later.

Related reading

• HR Documentation Checklist: The Records Every Employer Should Keep
• New Employee Onboarding: A 30-Day Process for Small Teams
• How to Prepare for an Internal Audit: A Four-Week Plan