Not surprisingly the vast majority of our employment law clients contact us after receiving notice of termination as they contemplate their severance agreements. Neglect, however often occurs at the happier end of the employment relationship. Most sophisticated employers bind their high end employees to restrictive covenants when they are first hired. When those same employees later exit the company they may have little leverage to renegotiate non-disclosure, non-competition and non-disparagement provisions that they signed without careful consideration or negotiation at the start of their tenure. As a result, when these employees contemplate their circumstances following termination they are already bound to restrictive provisions regardless of whether they sign the severance deal that governs their exit from the company.
When a new employer places an employment agreement in your hands at the start of a new job, call your attorney for legal advice to make sure you fully understand both the relationship you are entering, and what restrictions will follow you when you continue your career you’re your next employer.
Remove and adjust ambiguous language
Plug the holes that are found in most offer letters and employment agreements. An ambiguity regarding the frequency of salary adjustments or the criteria upon which they will be based can seem innocuous on paper at the start of a new job, but can evolve into a source of significant controversy. Likewise, ill-defined bonus, profit-sharing or equity plans can also give rise to later disputes. Careful drafting and negotiation at the start can lead to a more productive and positive relationship by removing uncertainty and potential conflict.
Employment Agreements that differentiate between benefits available to employees terminated “with” or “without cause” should carefully define those terms. Similarly, an employee should be provided with protection in the event his or her voluntary termination results in compromised benefits. “Voluntary” termination should not result from an employer creating an environment that becomes intolerable to the employee. If an employee loses rights to severance payments, equity vesting, or other compensation in the event of voluntary termination, an employer should not be rewarded for forcing the employee to leave the company.
Once signed, agreements are difficult to dispute.
If an employer is going to require restrictive covenants to be agreed to at the beginning of an employment relationship, the reasonableness of those restraints should be subject to negotiation at the time they are memorialized. It may be too late to reconsider the impact of a noncompetition agreement that you signed at the beginning of your employment when you are collecting your personal effects for the last time.
Generally, at the start of an employment relationship both sides are positive and anxious to establish a long and mutually beneficial association. c people become more defensive and anger rather than encouragement can dominate the discussions. Don’t simply sign the Employment agreement that is handed to you at the start of your new position. Such a contract can have career implications that extend far beyond the end of your next job.