Transcript
I. REVIEW
II. HUMAN RESOURCE MGMT I Elements of contract Provisions of employment contract
III. WRAP-UP
WAIVER
Signed by participants before activity If legally effective, participants’ negligence
claims against your organization will be dismissed by court
Against public policy (courts hate it!)
AGREEMENTS TO PARTICIPATE
Signed by participants before activity It must clearly explain
Nature of activity & danger Eligibility to participate (e.g., physical condition)
Not negate liability but helps defensive position
ELEMENTS OF CONTRACT: TO BE LEGALLY ENFORCEABLE, A CONTRACT MUST HAVE ALL FOUR
Offer Acceptance Consideration No defense
ELEMENTS OF CONTRACT: OFFER
Precatory terms: Not enough to become an offer “We’d like to have you here … Would be here if all
your concerns can be accommodated?” “We will be extremely happy if we can work together”
Clear enough: An offer “You will work from 9:00 a.m. to 5:00 p.m. Monday-
Friday, starting from next week … Your base salary is 35K not including performance bonus and employee benefits”
“You can work at home … The weekly compensation is commensurate with your performance, which is 5% commission on every sales agreement you would make”
ELEMENTS OF CONTRACT: ACCEPTANCE
Acceptance: Must accept entire offer as given
Additional term: Not acceptance but becomes a counter offer
Offer counteroffer acceptance Offer: “9-5 Monday-Friday, $1800.00
biweekly, no employee benefits except mandated by law”
Counteroffer: “OK … But I cannot work on Monday … Can I work on Saturday instead of Monday?”
Acceptance: “OK. Deal!”
ELEMENTS OF CONTRACT: CONSIDERATION
Promise to perform in a contract must be “bargained for”
No consideration: Not legally obliged to perform
“I will work for you because I like you” “I will give you free golf lessons every Saturday
morning” Consideration (“bargained for” promise): Must
keep the promise legally “I will work for your company for $500/week” “I will give you golf lessons every Saturday for
25/hour”
ELEMENTS OF CONTRACT: NO DEFENSE
There must not be a reason for which court would strike down the contract
Examples Contract made under duress No contract Contract term enforced against a minor No
contract Contract for performing an illegal activity
No contract
PROMISSORY ESTOPPEL: EXCEPTION TO REQUIREMENT OF CONSIDERATION
Agreement w/o consideration enforceable if A reliance is reasonably expected when it
was made In fact, there was a reliance The party relied upon has damage
Examples: If plaintiff can prove above three, the promisor must perform what he promised
PROVISIONS: REASSIGNMENT
Employers would loves to have & exercise this
Monson v. State of Oregon
Fact: A football coach was assigned to golf team under a state regulation (incorporated to contract)
Rule: Any reassignment under a valid contract is enforceable
PROVISIONS: COMPENSATION
Compensation includes not only salary but also “perks” (Examples)
Golf club membership Housing Transportation Spouse benefits
You must draft this provision very carefully
PROVISIONS: TERMS OF EMPLOYMENT
How long the work period will be (e.g., # of years)
Must be in writing if more than 365 days Rollover clause
After X years, automatically renewed year by year
Unless one party notifies not to renew Convenient but “lame duck” problem
PROVISIONS: TERMINATION
Termination for just cause EE breached the contract Morals clause: How to justify?
Termination without cause ER just fire EE without breach Legal action: “Wrongful termination” Good practice: “Buyout” provision w/
liquidated DMG
PROVISIONS: COVENANT NOT TO COMPETE
Generally disfavored unless it is written very specifically
Limited geographical region Definite & reasonable length of time period Example: Director of Nike Reebok (1 yr)
PROVISIONS: COVENANT NOT TO COMPETE
Northeastern v. Brown
Fact: ER’s consent required for football coach’s move
Rule: Injunctive relief is possible in addition to liquidated damage if “willful & intentional breach”
Court awarded more than usual
PROVISIONS: BUYOUT CLAUSE
If one party breaches the contract the breaching party must pay a lump sum $$$
Examples “If any party breaches any provision in this
contract, it will pay the aggrieved party 300,000”
“A party must pay 10 million the other if it terminates any provision in this contract prior to the end of the current contract term”
PROVISIONS: EMPLOYMENT AT WILL
Terminated at anytime, w or w/o cause, by employer or employee
Types of “at will” employment If contract explicitly provides that it is “at
will” If no term provided in contract If no written contract at all (= implied
contract)
FORMATION OF CONTRACT
Offer Acceptance Consideration No defense against contract’s
enforceability
ENFORCEABILITY OF CONTRACT
Promissory estoppel: Contract w/o consideration still enforceable for justice if
A reliance is reasonably expected when it was made
In fact, there was a reliance The party relied upon has damage
EMPLOYMENT CONTRACT: PROVISIONS
Reassignment Compensation Terms of employment Termination & liquidated damage Covenant not to compete Employment at will
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