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An employment contract is an agreement between an employer and an employee that establishes a new employment relationship. Employees can be categorized as at-will employees or independent contractors. At-will employees do not have a fixed contract duration and can be terminated by either party at any time. In contrast, independent contractors are hired for a specific purpose and time period. The employment contract outlines key aspects of the relationship, including the employee's duties, status (at-will or contractor), termination conditions, compensation, benefits, and the liabilities of both parties.