Employment agreements set the tone for your work relationship, but not all terms are fair or in your best interest. Understanding potential red flags can help you assess whether your agreement meets reasonable standards and protects your rights. Here, we’ll outline key warning signs and what they could mean for your employment.
Unclear Job Duties or Expectations
If the agreement lacks a clear description of your job role, duties, or performance expectations, you may face unexpected demands down the line. Vague terms about responsibilities can leave room for unfair work assignments, potentially affecting your workload, hours, or even compensation. This ambiguity also makes it difficult to hold your employer accountable if job expectations shift unexpectedly.
Ambiguous Compensation Terms
Clear compensation terms are essential to understanding your salary, bonuses, and benefits. Watch for vague language regarding payment schedules, bonus eligibility, or promised benefits. For example, terms like “subject to management’s discretion” on bonuses could mean they are not guaranteed. Ensure that all payment details are explicitly spelled out to avoid future misunderstandings or unexpected changes.
Overly Restrictive Non-Compete Clauses
Non-compete clauses can protect an employer’s interests, but overly restrictive terms may unreasonably limit your future employment opportunities. If the agreement restricts your ability to work in similar roles or industries for a long period or within a broad geographical area, it may be worth negotiating. Courts often disfavor excessive non-compete terms, so don’t hesitate to seek a more balanced approach if the restrictions seem extreme.
Broad Non-Disclosure Agreements (NDAs)
NDAs are common, but they should be limited to protecting genuinely confidential information. Beware of NDAs that are overly broad or seem to prohibit you from discussing basic employment details, such as job conditions or salary. An excessive NDA may limit your ability to discuss legitimate workplace concerns or make it difficult to pursue employment elsewhere without risking a breach.
Unfair Termination Clauses
Termination clauses outline how and under what circumstances your employment may be ended. Look for language that allows for “at-will” termination without a fair notice period, as this could lead to sudden job loss without warning. Additionally, if the agreement outlines a very limited severance package or no severance at all, consider negotiating for more favorable terms to protect your interests in case of unexpected termination.
One-Sided Dispute Resolution Terms
Pay attention to clauses that dictate how employment disputes will be handled, such as mandatory arbitration. Agreements requiring all disputes through arbitration rather than court can limit your legal options and may favor the employer. If the dispute resolution terms seem heavily skewed in favor of the company, you may want to negotiate or consult an attorney to ensure fair terms.
Excessive Probation Periods
Probation periods allow employers to assess new hires, but if the probation period is unusually long or lacks clear terms, this could be a red flag. Extended probationary terms can leave you without certain benefits or job protections, so ensure the duration is reasonable and check for any restrictions on pay, benefits, or job security during this time.
Seek Legal Counsel On Your Employment Agreement
Understanding your employment agreement and recognizing red flags can protect you from pitfalls and unfair treatment. At Lipsky Lowe, we’re here to help you secure fair and reasonable employment terms, giving you peace of mind and confidence in your professional future. Contact us for a consultation today.
About the Author
Douglas Lipsky is a co-founding partner of Lipsky Lowe LLP. He has extensive experience in all areas of employment law, including discrimination, sexual harassment, hostile work environment, retaliation, wrongful discharge, breach of contract, unpaid overtime, and unpaid tips. He also represents clients in complex wage and hour claims, including collective actions under the federal Fair Labor Standards Act and class actions under the laws of many different states. If you have questions about this article, contact Douglas today.