Which type of agreement involves direct negotiation between an employer and an employee?

The correct answer is an individual contract, which involves direct negotiation between an employer and an employee. This type of agreement is personalized and tailored specifically to the terms and conditions of employment for a single employee, as opposed to collective agreements that involve negotiations between an employer and a group of employees (often represented by a union). In an individual contract, the agreement outlines specific roles, responsibilities, remuneration, and other conditions that are unique to the individual.

In contrast, collective agreements involve discussions and outcomes negotiated on behalf of a group of employees, which means they lack the direct, one-on-one engagement characteristic of individual contracts. Industry-wide awards provide standardized conditions and pay rates across a specific industry, and these are not tailored to individual circumstances. A performance management strategy refers to processes and frameworks used to manage employee performance rather than a formal agreement related to employment terms. Thus, individual contracts are distinctive in their focus on the relationship and negotiation between one employer and one employee.