Employment relationships are regulated by the contract of employment, industrial instruments such as awards and statutory agreements, and applicable federal, state and territory legislation. Unregistered collective agreements and employer policies may also impact on the employment relationship.

The sources of terms in an employment contract include those that are:

• expressly agreed between an employer and an employee, verbally or in writing (or both) (see Express terms in employment contracts). Express terms are commonly reflected in a written employment contract or agreement, which may also incorporate the provisions of employer policy documents (see Employer policies); and

• implied into the contract in fact, by custom and practice, or in law (see Implied terms in employment contracts).

The following set down minimum terms and conditions of employment, but generally do not form part of the contract of employment (unless they are expressly incorporated):

• statutory minimum employment standards, such as the National Employment Standards operating under the Fair Work Act 2009 (Cth) (FW Act) (see Sources of terms of employment contracts — statutory minimum standards); and

• modern awards and enterprise agreements operating under the FW Act (see Sources of terms of employment contracts — awards/enterprise agreements).

As a result, employment contracts must provide for terms and conditions that are the same as, or more favourable to employees than, those set down in relevant provisions of the FW Act, awards or enterprise agreements. Contracts of employment must not derogate from statutory, award or agreement minima.