After a long and often arduous job search, you’ve received an offer from one of your top choices. All you have to do is sign on the dotted line, and you’ll be gainfully employed at an organization with a culture and values you can get behind!
But hold on there – before you sign that contract, did you have an attorney look it over? Probably not. Aside from those of us in the highest corporate echelons, few people seek legal advice when it comes to employment contracts – but that’s a behavior you may want to consider adopting.
“One of the things critical for everyone to know when presented with an employment contract is there could be things in there they are obligating themselves to that they don’t realize – or, if they’re not careful, could prevent them from working in the future for some time,” says Jeffrey Scolaro, an attorney at Daley Mohan Groble who has worked with both employers and employees.
Watch for Restrictive Covenants
One of the biggest reasons why Scolaro urges job seekers to consult attorneys before signing anything is because many employers today insert “restrictive covenants” into employment contracts. These are clauses that prevent employees from taking certain actions – even after their employment has ended.
There are a few different types of restrictive clauses out there, with the most commonly encountered type being the non-compete clause.
“This type of restrictive covenant can prevent you from working in certain industries or with companies doing a similar type of thing to what you’re being employed to do,” Scolaro explains. “You have to make sure that if you’re obligating yourself to [a non-compete clause] you are being adequately compensated for it. Obviously, everyone needs or wants to work, so to have to sit on the sidelines for X period of time after you leave this job or after this job ends is a very important thing to be aware of.”
Job seekers also need to look out for non-solicitation agreements, which “can prevent you from going after or taking clients of the employer, regardless of whether or not you found them on your own,” Scolaro explains.
He elaborates: “While working, [clients] become essentially the property of the employer. It’s their customer list. Employment agreements will often prevent you from going after them – even if you didn’t solidify a relationship. If you talked to [a potential client] at all, it can prevent you from going somewhere else with them.”
Scolaro also notes that non-solicitation agreements often extend to the company’s employees as well, which many people are not aware of.
“So, if you and three of your colleagues wanted to go start your own company, you could bind yourself from being able to do that in your employment agreement,” he explains.
Clear Up Misconceptions
Attorneys can also help job seekers clear up their own misconceptions regarding employment law. One common example Scolaro sees often is confusion regarding who is and isn’t an at-will employee.
“Just because you have an employment contract doesn’t mean you’re not an at-will employee who can be terminated at any time,” Scolaro says. “I think that people think that if they have some type of contract, they’re guaranteed a job for a certain period of time. That’s oftentimes not the case. You want to understand your relationship with your employer. That can determine how you can be let go, what the terms are under which you can be let go, etc.”
Employers Sometimes Make Illegal Demands
Another important reason why job seekers should have contracts looked at by attorneys: Employers sometimes end up asking employees to agree to things that aren’t legal without realizing it. Some non-competes, for example, would never hold up in court.
Employers rarely do this sort of thing maliciously; more often than not, illegal contract clauses are simple mistakes.
“[These clauses] won’t hold up in court, so it really doesn’t do [an employer] any good to be asking those kinds of things,” Scolaro says. “Often, if an employer is receiving bad advice or thinks they are able to do something they’re not, that could be in the contract irrespective of the fact that it’s not permissible. That’s a no-win situation for everyone.”
In an ideal situation, employers would have lawyers look over their employment contracts before extending offers, but that’s not always the case – especially when it comes to small businesses and startups. Rather than relying on the company’s lawyers – which may not exist – job seekers should turn to their own attorneys for help.
Scolaro recommends finding an attorney who has experience with employment law.
“It can’t be your buddy who went to law school and never practiced,” he jokes. He also suggests visiting a site like Legal Services Link if you don’t know where to start.
This article is for informational purposes only and does not constitute legal advice.