Avoiding Unintentional Employment Agreements


Employers sometimes need to offer executive position candidates employment agreements in order to successfully entice them to the company. Because employment agreements generally give employees more rights than they normally would have under the common law employment at-will doctrine in place in New York and many other states, employers are incentivized to negotiate the employment agreements' terms carefully. Making this goal difficult for employers is the modern technology of emails, texting, etc., which has led to claims of employment agreements without formal documents drawn up and signed.

A recent case found that an employer's intent to avoid any claim of an employment agreement prior to the execution of a formal document was successful. The employer simply stated in the initial term sheet regarding the employment terms being negotiated that a formal executed document would be needed prior to commitment/liability. The court found that this language trumped the seemingly promissory words in the subsequent emails between the company and the prospective executive employee.

As always, engaging counsel early on in an employment agreement negotiation is the best strategy to avoid unintended agreements.