November 9, 2005
Previously published by LexisNexis® Martindale-Hubbell® Counsel To Counsel Magazine on November 2005
Martindale-Hubbell posed the following question to provide a variety of views on this important topic:
How do companies avoid common problems when drafting
employment agreements?
In their eagerness to snare the perfect
candidate, companies neglect critical
elements of a successful employment
agreement, including:
- Failure to incorporate reasonable post-employment
restrictions. Prospective
employees need to be aware of and agree
to these prior to starting employment.
Seeking restrictions afterward is not
allowed in certain states without
additional consideration.
- Ambiguity in compensation terms.
Leaving the specifics of bonus plans and
perks for later can be a prescription
for disaster and can lead to breach-of-covenant
of fair dealing litigation.
Finally, include a well-thought-through exit
strategy such as termination, severance and
mandatory arbitration provisions.
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