Things to Look Out For in a New Employment Contract

Things to Look Out For in a New Employment Contract

Aside from the obvious provisions on salary, bonus, commission, etc. things to look out for are the notice provisions – how long those are – are you being asked to enter into a probationary period that might give you a reduced period of notice with less protection? Also another area of contention is post-termination restrictions. So, provisions stopping you from going to a competitor following the termination of your employment, stopping you from dealing with clients, or soliciting clients, or soliciting employees. Provisions that people might not spot are, with regards to notice provisions, often there is a payments in lieu of notice clause that only provides for basic salary only. So if the employer terminates then you would only receive basic salary for that notice period and not the other benefits or bonus. So that is something that often gets overlooked. Another area is bonus schemes and when bonuses may or may not be payable and when you might be eligible to receive a bonus. Many bonus schemes state that if you’re no longer in employment you may not be eligible to receive it. We would recommend if you are a senior executive looking to move employment that you come and take advice at an early stage before signing the contract to ensure you get an overview and flag any concerns that you might have. I think that people often worry about what employer are going to think if they go back and negotiate a lot on the contract but generally it’s something that employers will often expect and employees are best advised to do that at the outset whilst the employer wants to recruit them, rather than waiting further on down the line. Often we’re advising in the background, so we would be doing a review and then your employer won’t necessarily know that we are providing that legal advice and then we would advise the employee to generally do the negotiations themselves. We are often asked how quickly we can turn around a contract review and the answer is very quickly within a few days, so the employees have plenty of time to go back to the employer with comments or questions and seek to negotiate a more favorable contract.

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About the Author: Oren Garnes

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