How Long Should the Term of an Employment Agreement Be?
// Dallas, Texas, United States // Attorney Keith Clouse (Blog) // Keith Clouse
Keith Clouse, a Dallas, Texas employment lawyer who frequently advises executives on employment agreement matters, notes that most employment agreements contain temporal terms. A temporal term defines the length of the employment relationship. If a party terminates the employment relationship before the term’s expiration, penalties are usually imposed.
Usually, an executive seeks a term long enough to give him sufficient time to transition into his new role. At the same time, an executive does not want to be locked into a truly long-term arrangement unless the exit terms provide an easy escape route should relations sour. For these reasons, many executives negotiate contracts that impose two to three year terms.
Sometimes an employer will not want to commit to a set term. In those situations, the employer retains the power to fire the executive at any time, but the parties agree that if the employer terminates the executive without cause, the executive will receive a severance package. An executive should push for a substantial severance package; otherwise, he remains essentially an at-will employee.
This article is presented by the Dallas employment attorneys at Clouse Dunn LLP. An executive contemplating a new opportunity should consult with legal counsel to ensure the proposed employment agreement adequately meets the executive’s needs. To speak to an employment lawyer about an executive employment agreement, send an email to debra@clousedunn.com or call (214) 239-2705.
Contact Keith Clouse
KEITH A. CLOUSE
Clouse Dunn LLP
214.220.2722 214.220.3833 ( fax) keith@clousedunn.com
