In Michigan as in the rest of the United States, most employees are at-will employees with no employment contract. High level or executive employees, however, are often in a position to negotiate an employment contract that can, among other things, protect them from discharge at will. For people in this position, setting the terms of the employment contract prior to execution is very important. Once a person is hired, they have no leverage to negotiate a better deal.
Employment contracts drafted by the employer usually do not provide employees adequate protection. Employees should read the proposed contract carefully to understand the terms and of possible, negotiate for favorable provisions relating to severance pay, stock options, retirement plans, relocation expenses and change in control. The experience and negotiating skills of an employment attorney can make a critical difference.
Employees should seek a termination clause that does not permit the employer to terminate the employee without sufficient reason. In case of termination, the contract should ensure that the employee is adequately compensated for the sudden and unexpected loss of income.
Another important provision in an employment agreement is the non-compete clause. While the employer typically wants a strict non-compete clause, the employee should seek one that will not restrict them from earning a living once they leave the company.
Change in control provisions protect an executive employee from sudden job loss if a change in company ownership or senior-level management should occur. Often, new owners of a company want to replace key management personnel. A change-in-control provisions can provide for fair severance pay under such circumstances.
Employers should also be requested to provide relocation expenses if the employee is required to move to a different city to keep a job. The prospective employee should also make sure the agreement includes adequate retirement benefits.
Any Detroit resident who is starting new a new job and is concerned that the terms of an employment contract will not adequately protect their interests can consult an employment lawyer to negotiate the employment contract on his or her behalf.