Navigating Termination Provisions in Your Employment Contract
Demystifying Termination Provisions in Employment ContractsWhen it comes to your employment contract, understanding the termination provisions is paramount. Whether you're entering into a new employment agreement or reviewing an existing one, it's crucial to comprehend how your rights are affected by the circumstances of your termination. Most commonly, employment contracts distinguish between terminations "for cause" and those without cause, each carrying distinct implications.
In this guide, we'll explore these distinctions, delve into severance options, and shed light on how the nature of your termination might impact unvested equity interests. Additionally, if you're subject to a non-compete agreement in Massachusetts, the cause of your termination becomes even more critical due to recent legal developments. Termination "For Cause" vs. Without CauseIn many employment contracts, the determination of whether your termination is "for cause" or without cause can significantly impact your rights and entitlements. Generally, if you're terminated without cause, you may be eligible for severance benefits that would not be available in the event of a termination for cause. It's vital to be aware of the specific language in your employment agreement or your employer's written policies, as there is no universal definition of what constitutes "cause" for termination in private employment.
Equity Interests and VestingFor employees with equity interests, the nature of your termination can also influence the vesting of unvested equity. Understanding how your contract addresses equity vesting in various termination scenarios is essential, as it can have significant financial implications.
For Cause Termination and Non-Compete Agreements in MassachusettsIf you're bound by a non-compete agreement in Massachusetts, the circumstances of your termination take on added importance. Recent changes in Massachusetts law render non-competes unenforceable if you were fired without cause. Therefore, knowing the cause of your termination is critical if you want to explore new career opportunities without legal restrictions.
Negotiating the Definition of Cause in Your Employment ContractIf you're in the process of negotiating an employment contract, it's crucial to pay close attention to these subjective and vague definitions of "cause." Ideally, you can work towards making these definitions more explicit, leaving less room for ambiguity. However, if achieving such specificity isn't feasible, consider negotiating for a provision that grants you the opportunity to rectify any issues before a "termination for cause" can be initiated.
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Meet Our Employment Lawyers
Emily Smith-Lee is the owner and founder of slnlaw. She is a 1996 graduate of Boston College Law School. She was previously a partner at the Boston office of a large international firm, where she worked for thirteen years before starting the firm that became slnlaw in 2009. She has been recognized as Massachusetts Superlawyer each year since 2013, and in 2018 earned recognition as one of Massachusetts Lawyers Weekly's Lawyers of the Year. She has written a book on employment law: Rules of the Road, What You Need to Know About Employment Laws in Massachusetts. Along with the rest of the slnlaw team, she has helped hundreds of clients navigate, negotiate, or defend against the terms of their employment agreements, including non competes, non solicitation agreements, employment contracts with intellectual property provisions and other restrictive covenants, and executive employment agreements.
Rebecca Rogers: Rebecca is a 2006 graduate of Boston College Law School, and has worked with slnlaw since 2013. She previously worked as an intellectual property litigation attorney for Fish & Richardson in Boston, Massachusetts, and clerked for the Massachusetts Supreme Judicial Court. Rebecca has helped many clients understand and evaluate their non compete agreements and develop strategies for defending against non compete enforcement and negotiating resolution, and understand and navigate other employment contracts.
Jenna Ordway: Jenna is a 2013 graduate of Quinnipiac Law School, and also earned an LLM in Taxation from Boston University in 2015. She has been affiliated with slnlaw since 2011, first as a law clerk and then as an attorney. Jenna has been recognized since 2019 as a "Rising Star" by Massachusetts Superlawyers. Jenna works with employers to develop reasonable and enforceable employee agreements, including non competes, non solicitation agreements, executivev employment agreements and incentive agreements. She has also helped employees understand and evaluate their non compete agreements and develop strategies for defending against non compete and non solicitation enforcement and negotiating resolution.
Elijah Bresley: Eli is a 2014 graduate of Seton Hall Law school, and has worked with slnlaw since 2020. He previously worked for a boutique employment law firm outside of Boston, and then for the Labor and Employment department of a large Boston firm. He also spent a year clerking for the judges of the Superior Court in Hartford, Connecticut. Eli has helped clients both evaluate and negotiate their employment agreements, including non competes, non solicitation agreements, employment contracts with intellectual property provisions and other restrictive covenants, and agreements requiring employee payback of retention bonuses or training expenses. Eli has also defended claims against employees based on employment contracts in state and federal courts.
How We Can Help
Our team of seasoned employment law experts is here to guide you through the complexities of employment contract terminations. Whether you're negotiating a new agreement or deciphering an existing one, we offer expert advice to ensure your rights and interests are protected. You can use the button below to schedule a call back from a member of our team, or give us a call at 781-784-2322.
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