(a) The board of supervisors may by ordinance at any time create the office of township manager and may in like manner abolish the office. While the office exists, the board of supervisors shall appoint one person to fill the office. The township manager shall serve at the pleasure of the board of supervisors, subject to contractual rights that may arise under an employment agreement that may be entered into in accordance with subsection (a.1).

(a.1) The board of supervisors may enter into an employment agreement with the township manager. The employment agreement may set forth the terms and conditions of employment, and the agreement may provide that it shall remain in effect for a specified period terminating no later than two years after the effective date of the agreement or the date of the board of supervisors' organizational meeting following the next municipal election, whichever shall first occur. An employment agreement entered into pursuant to this subsection may specify conditions under which a township manager would be entitled to severance compensation, but in no event shall an employment agreement guarantee employment through the term of the agreement or confer upon the township manager any legal remedy based on specific performance.

(b) The powers and duties of the township manager shall be established by ordinance. The compensation shall be set by resolution and paid out of the general fund of the township. The board of supervisors may delegate, subject to recall, any of their nonlegislative powers and duties to the township manager. The township manager shall give bond to the township, with sufficient surety, in the amount directed by the board of supervisors, conditioned for the faithful performance of the duties of the office.

(c) The office of township manager is not incompatible with the office of township secretary, township treasurer or any other township office or employment, except that of supervisor, auditor or township police officer.