Many executives do not fully negotiate the terms of their employment offers. If they do negotiate on their own, they often focus solely on the compensation terms. While compensation (such as base, bonuses, long and short-term incentives, and equity) is obviously important, there are non-monetary terms that can be equally important. These provisions tend to stand out to executives when they are experiencing issues with a board, or with their supervisor, or if they are asked to depart the company.
Companies often use restrictive covenants in agreements. These provisions, such as non-solicitation clauses and non-competition clauses, can affect the ability of an executive to move forward in their career. Too many times, executives don’t consider the potential limiting impact of a restrictive covenant on their ability to move into another role. It can be helpful to have an employment attorney review an offer of employment and suggest ways to limit the impact of restrictive covenants.
Executives often want to move on after a restructuring. It is common that after a restructuring, they may be offered a reduced scope of responsibility. An employment contract can address situations where an executed is demoted due to a restructuring. Again, these issues often aren’t apparent or “top of mind” to executives when considering an offer of employment.
Many executives experience deep frustration and disappointment when the company’s Leadership Team or Board simply wants to “go in a different direction,” eliminates their position, or asks the executive to depart. This often happens after an executive has made major life decisions, such as relocating for the position, being recruited from a solid role, or rejecting other lucrative offers. When this occurs, it is the non-monetary provisions in the contract, and not the compensation provisions, that control. An employment attorney can review a proposed offer and limit the impact on the executive if the company decides to go in a different direction.
In summary, when reviewing and negotiating an employment offer, it is important to focus on both compensation and non-monetary provisions. Often an employment offer can be negotiated to (1) protect the executive’s ability to move on to a new role in the same field; (2) to protect the executive’s compensation in the event of a demotion; and (3) to negotiate non-monetary provisions that will limit the impact on the executive and provide a runway in the event the executive is asked to depart the role.
The employment lawyers at the Maura Greene Law Group have experience reviewing and negotiating executive employment contracts and offer letters. We can help you understand your rights and options and ways to potentially negotiate your employment terms.
Contact us at 617-936-1580 or email us at [email protected]
The Not So Fine Print:
Every case has its own unique facts. Before you take any action, you should contact an employment lawyer and get advice on your own situation. We can’t provide legal advice here and this isn’t intended as legal advice. Keep in mind that it is best, if possible, to establish a relationship with an attorney before a workplace issue turns into a full-blown crisis.