Many small businesses routinely deal with other companies and individuals on a friendly, casual basis, entering into numerous oral agreements with no problems.  For example, a business may loan money to an employee or offer an advance on an employee’s paycheck without putting the parties’ agreement in writing. In most instances, no problems will arise, but if such an arrangement ever goes awry, the business could be left without much recourse.

In Texas, some contracts must be in writing and signed by the party to be charged with the promise, such as an agreement that cannot be performed within one year.  But, even if an agreement is not required to be in writing, employers should consider formalizing any arrangements with an employee.  First, a written agreement is usually easier to enforce in court because the document itself provides evidence of the agreement’s terms and conditions.  Second, the very act of committing the agreement to writing forces the parties to address contingencies and terms that they may not have considered originally.  The parties can then ensure that the written agreement addresses these concerns and accurately reflects the parties’ understandings.

To speak with an attorney at a Dallas employment law firm, please contact the employment law lawyers at Clouse Dunn Khoshbin LLP at info@cdklawyers.com.