An employment contract should memorialize the terms of the relationship that were discussed during negotiations, including:
- Start date and term
- Job title and expectations
- Rate (or rates) of pay
- Commissions or bonuses
- The legal name of the employer of record
- Confidentiality and non-disclosure of certain job-related information
In New York, they might also include many of the notices required by the State’s Department of Labor and a lot of legal jargon that makes you wonder what you might be getting yourself into. Before you sign, we can help you understand those “standard terms” and the legal consequences of what did and didn’t make it into the employment contract document.
Confused by terms in your employment contract?
What Makes a Valid Employment Contract?
In its simplest form, a valid employment contract arises out of three negotiation stages:
- An offer. The employer offers you a compensation package that includes your salary, insurance benefits, and other options or perquisites (“perks”).
- Acceptance of the offer. You accept the offer, either as presented, or by making a counter-demand that the employer agrees to meet.
- An exchange of value (consideration). You promise to perform the services in your job description. In exchange for your services, your employer promises to deliver the compensation package.
Should You Make a Counter-Demand?
Probably. When you request changes to an employment contract, you:
- Ensure you aren’t bound to a term (promise) you can’t keep. If the pay won’t cover your expenses or the hours of work are too difficult to fit into your already demanding life, it’s better to discuss that before you sign.
- Signal to your employer that you are savvy and detail-oriented. That is likely desired from a key employee (leader), and how you assert yourself will help the hiring team see they made a good decision.
- Gain insight into the employer’s management style. The hiring manager’s response to your counter-demand will tell you a lot about how much you are valued and respected. If they are rigid in the negotiations, do not expect them to soften once you start working.
Aligning with Employer Goals
Assuming all goes well and you sign the written employment contract, remember that you are signifying agreement to all the terms in it. If something goes wrong in the relationship, your employer will typically be scrutinized more than you, but that is not enough to release you of all obligations.
Employee handbooks should detail those obligations. They give you the rules of the game, and playing by those rules will help you win it. Take time to not only learn your rights and benefits, but also determine how your job fits into the vision, mission, and goals of your employer.
Avoiding Employment Disputes
When disputes occur over terms of employment, it is often because of something that happens after the document is signed. One of the parties has second thoughts making them unsure they want to meet their obligations. To get out of the relationship, they will typically argue:
- There wasn’t a true and enforceable agreement.
- What happened after the signatures violated (breached) the contract terms.
- Conflicting provisions void the agreement.
Reduce the risk of a costly court battle by clarifying the contract terms before you start working.
Leaving on Good Terms
No matter how much you love the job, the employment contract will end. If it ends through a layoff, you might be offered a severance package.
Notably, severance pay is not mandatory, and limitations on several common clauses in severance agreements have made New York employers less likely to offer it. Much will depend on whether you have leverage to negotiate a higher amount. That leverage typically comes from the risk of a lawsuit, such as for:
- Discrimination
- Sexual harassment
- Retaliation
It might also come from the risk of you competing with your outgoing employer, which is why non-competition clauses are often included (but also limited). You’ll be given time to consult an attorney. We, of course, recommend that you do.
Not sure your severance agreement is fair?
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Thank you again for everything. It’s been a very difficult time and you have been a wonderful help! ~ C.R., Employee, NY