BY G. A. FINCH
Too many times, a situation in which an executive starts a job with an unfinished employment agreement does not turn out well. Not always the case, but often the case. An executive does not want to be in the percentage of employees who get terminated without a completed, signed employment agreement. The executive’s relying on the employer to do the right thing in terms of what the employee thinks the deal was, is not a good choice.
Obviously an executive has the most negotiating leverage when a company is seeking to hire the executive. At the start of the relationship, there is good will between the employer and prospective employee and there are high, positive expectations on both sides.
An executive is eager to demonstrate trust and enthusiasm by agreeing to start while an agreement is being finalized. I know of executives who have quit their prior jobs, forsaken substantial benefits, and relocated to distant cities without a signed agreement. Two scenarios usually are the case. One scenario is that the executive and the employer are still hashing out contract terms after the executive has started employment. Another scenario is the executive has started working and has never received a signed agreement – it falls through the cracks so to speak.
There is an old saying that “Familiarity breeds contempt.” An employer’s shiny new executive now has blemishes and scratches upon closer inspection. The sense of urgency has dissipated once the employer has gotten its prized employee. It is human nature to value something less after it has been obtained.
Accordingly, an executive must never start a job without a completely finished, signed agreement in hand. Moreover, whatever “final” employment agreement is tendered to him, the executive’s attorney must review it one last time to ensure that the final draft reflects the latest iteration of the negotiated contract terms. Last minute language insertions or failure to include agreed-upon provisions can and do happen, sometimes carelessly and in good faith by the employer and sometimes by design. An executive’s insistence upon having in hand an executed agreement prior to work commencement is prudent and makes common sense. In order for the executive to be able to maintain a congenial relationship with his prospective colleagues or bosses, the executive’s attorney should take the responsibility for requiring a signed agreement.
An executive does not want to be in the more difficult position of proving up the terms of an unsigned, draft contract in a court of law than the easier position of proving up a final, signed contract.