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Employment Contracts

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In the past, the major reason that the companies did not like to enter into employment agreements was that they were basically for the protection of the employee. Fewer benefits accrued to the company except to prevent the employee from leaving to join a competitor.

But, here again, times have changed in this world, and employers have discovered an important reason they may want to write an employment agreement-being able to fire at will.

It used to be the inalienable right of an employer to fire an employee for any reason whatsoever, at any time, and with no severance pay if so desired. Things are different now. Employees have sued and won judgments in the courts based upon the implication that the employer must have valid reasons to discharge an employee, and, of course, the validity of those reasons must be determined by a jury. The employment agreement may be one of several ways the employer can defend against such lawsuits if the contract makes it clear that the employer has the right to fire at will, provided there's a caveat explaining what constitutes cause for discharge.



Even though there is this new advantage to a company in writing employment agreements, they generally reserve them for high-level positions within the corporation. For a lower-level employee seeking a job, it is only probably futile to ask for a written contract, it could dash your chances of being hired at all.

Still, because the benefits are great to some employees, the questions of a written contract might not be a bad idea to rise if you think the atmosphere is conducive to risks, and particularly if taking the job means you have to relocate out of town.

Bear in mind that employment contracts for you are mainly nothing more than "exit contracts."

Unless you can offer to a company skills considerably above and beyond those of others seeking the same position, and you're giving up a good job to join the new company, your chances of being given a written employment agreement, even today, are slender at best unless if you qualify for a top-management job.

There is another type of employment agreement, a letter form, and that simply spells out what has been promised, should you take the job. If there are stock options, guaranteed bonuses based upon your performance level and the company's, and other additional compensation, any company offering these things should be willing to put them in writing. It is not uncommon to put into this type of agreement a severance clause, which requires the employer to pay the employee a stipulated amount of severance pay in the event of termination without cause.

But if that isn't the accepted practice at the company with which you're seeking employment, it's unlikely for them to make an exception for you. Demanding that kind of an agreement before accepting a job is akin to a man or woman demanding a prenuptial agreement before marrying. There certainly are good reasons for premarital agreements, especially in second marriages where there are children from previous marriages to be protected. Still, a prenuptial agreement, no matter how well-meaning, sets up an atmosphere of distrust that can get in the middle of a smooth and happy beginning to the new union.

The same atmosphere of distrust is created in business when an employee insists upon having everything in writing.

My suggestion is that unless you truly don't need the job you've been offered, and are unwilling to make a change unless you have everything in writing-ask for it. If it backfires on you, accept that graciously and continue your job search until you find a company that is willing o meet this demand. If you're unemployed and are not required to move out of town, my advice is not to ask for any form of contract.
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