Contract negotiations

Tips and traps:

• I have an article on Contracts that is linked-to all over this site, and is probably on the menu above.
• An employment-related contract can be oral, and always starts orally, and then the parties write down the most important terms of their oral understanding — A written agreement isn’t the “contract” as much as it is a recording of your oral agreement. So in a sense, the oral agreement can be the real contract. However, in a court, the written agreement will probably play a larger role, but that isn’t guaranteed.
• Non-compete-type of contracts should be negotiated whenever possible — Companies tend to want way way too much in restrictions, and can destroy your career after you get fired or quit. Your relationship with the company WILL end someday. So you need to worry about the endtimes.
• Plan for the end at the beginning. Provisions can be inserted into the agreement that deal with the endtimes, and cushion the blow, or provide an honorable separation — you will probably need to be in a good bargaining position to make such provisions a reality, otherwise your demands will be rejected.
• Don’t attempt any contract negotiation without having a lawyer, at least on background. Here is what that means: Meet with a lawyer to determine what you should be asking for. Then YOU ask for it. Then YOU reply to the other side’s pushback. The other side wants “my way or the highway” and it could be a shock to them when you state your desires or demands — Contract negotiations require a lot of thought and careful planning and truly a deep analysis of your unique circumstances and needs and bargaining power.
• Sometimes lawyers can mess up negotiations – That is because if a lawyer gets involved directly, it scares the company, and causes your negotiations to escalate to the level of the company’s General Counsel. And the two lawyers might get into a pissing contest and cannot get the deal done — But if the company really wants you, then management will issue stern marching orders to the General Counsel, and the deal will get done — But in the cases where management isn’t so certain about your value, then the bargains may be harder to accomplish.

  The General Counsel will be asking your potential hiring manager about everything you want, and advising the company at every turn — In ordinary cases, I tend to think it is better not to get the General Counsel involved until the outlines of the deal are hammered out by YOU. (exceptions are the rule though — and the more valuable your contract, the more likely it is that your lawyer really needs to be immersed in the process from the start, and directly involved in the negotiations)

• In a more routine contract, try to hammer out the deal by getting quiet background legal advice about things to include in the contract, and then, when the deal is done, your lawyer can work with the General Counsel on the exact language needed to memorialize the deal.
• So find out what you need to ask for, from a lawyer if possible, and then demand those things in the right way considering the unique circumstances of your situation.

Article written by | Tim Willoughby