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A Director's Service Contract is a contract of employment between a director and a company. It regulates the relationship between the director and the company and sets out the duties, obligations, and responsibilities of the director. Companies are legally required to provide directors with a service contract.
An independent director is hired by an entity to sit on the board of directors. They are not affiliated with the operation of the entity and are independent in order to make unbiased decisions regarding financial matters should the need arise.
A director may legitimately be engaged as a contractor and yet superannuation may still be applicable. Dividends paid to a director of a company are not subject to superannuation.
Noun. a contract between an employer and a senior employee, esp a director, executive, etc.
The court observed: "a managing director holds two positions and acts in two different capacities in that he is a director of a company and qua director is governed by the Companies Act but he is also an employee of the company and qua employee the relationship must fall squarely within the ambit of the Act''.
How to Write a Service AgreementA description of the parties involved in the agreement.A description of the services to be performed.A description of fees and payment schedules.The effective date of the contract, when work will begin, and the terms under which it can be terminated.Include a place for signatures.More items...
A Director's service agreement is a contract that sets out the terms that a company director works under. Directors are key people within a company and it is essential to make sure their contracts are clear about their rights and responsibilities.
A service agreement should be used every time your business agrees to provide a service to a client or customer. While this might seem burdensome you can set up a contract management process to reduce time and errors and likely increase revenue.
As per Section 21 of Companies Act, 2013 CA,2013: a document or proceeding requiring authentication by a company; or contracts made by or on behalf of a company, may be signed by any Key Managerial Personnel KMP or an Officer or Employee of the company duly authorised by the Board in this behalf.