Contract Clauses Archives

Voluntary – Key Words & Phrases

Published on February 19th, 2019 by Alan L. Sklover

Sklover Working Wisdom keywords and phrases

Be on the lookout for . . .

“Voluntary,” as in “Voluntary Departure,” “Voluntary Resignation”
or “Voluntary Waiver”

You’re quite likely to find the word “voluntary” in several work-related legal documents. If you do notice it, that word may be very advantageous to you.

Generally speaking, “voluntary” means “done on one’s own free will.” It is synonymous with discretionary, unforced and optional. In legal documents, it often suggests that the act described was not required, not coerced, and not demanded.

Let’s say that, according to your employer’s Annual Bonus Plan, you are not entitled to your annual bonus if you “voluntarily” resign before the day it is paid. What if, two weeks before bonus payment date, you resigned and left your job in fear that your boss might beat you up in one of his infamous uncontrolled rages?

Was your departure “voluntary?” I’d say no. Are you entitled to your annual bonus? I’d say yes, although I’m confident that most employers would disagree.

You have a strong, reasonable and likely winning argument that the bonus is yours, so long as you spot, appreciate and point to the word “voluntary.”

In Repayment Agreements, you might promise to repay your employer in, as examples, a Sign-on Bonus Agreement, a Relocation Expenses Policy, or a Tuition Assistance Plan if you “voluntarily” leave before two years of service. What if you left earlier than that because, all of a sudden, your salary was reduced by 40%, and your family likes to eat three meals a day? (Some kids demand 4 or 5!!)

Is feeding your hungry family “voluntary?” I’d say No. Was your departure to take a better paying job truly “voluntary?” I’d say No. For this reason, you have a very good, and probably winning, basis to argue, with likely success, that your repayment is not required.

So, in this circumstance, too, you may very well not have to repay any sign-on bonus, educational assistance, etc., so long, that is, as you spot, appreciate and raise in your defense the word “voluntary.”

The same goes for whether a Non-Compete Agreement is valid or void, according to its own words. If the non-compete says it is valid if you “voluntarily” leave your job, and you can show that you are allergic to the new paint used throughout the office, then it is void as to you, so long, that is, as you spot, appreciate and raise the word “voluntary.”

There are many other legal documents that may contain the word “voluntary.” Look for “voluntary” in any and every workplace document, whether in an agreement, a company policy, an Employee Handbook, Stock Award, or other document.

You may be VERY GLAD you did.

Need a model memo or letter to transmit a request or complaint? A good checklist or form agreement? For a complete list of our Model Letters, Memos, Checklists and Sample Agreements, Just [click here.]

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Your Path to Dignity at Work”™

© 2019 Alan L. Sklover All Rights Reserved and Strictly Enforced.

Boilerplate – Key Words & Phrases

Published on September 4th, 2018 by Alan L. Sklover

Key Words

In contracts, what is meant by:

Boilerplate?”

Often people refer to certain provisions of an agreement as “boilerplate.” For example, it is quite common that a client will say to me “The agreement I need you to review is mostly boilerplate, so it should not take long to review.”

What do people mean by “boilerplate?”

Many years ago, “boilerplate” referred to extra metal plates that were wrapped around a boiler to limit damage if the boiler blew up. They were often unneeded and used more for show than for effect.

As commonly used today, “boilerplate” refers to provisions or sections of a contract (1) that are “standard,” (2) don’t much affect the contract’s “important points,” (especially those that refer to money matters), and (3) so, don’t really need to be reviewed carefully.

Beware: each of those three statements are wrong, more wrong, and even more wrong, and it’s better you learn that here and now, and not “the hard way.”

First, there is no such thing as a “standard” contract clause or “standard” contract language because every employee, every employment relation, every word and every punctuation mark in a contract or agreement is different, and so all need to be carefully read and considered. Missing a single “black dot” in a contract is the legal equivalent of missing a single “black dot” on an x-ray.

Additionally, when reviewing a contract, you must also consider what might be “missing” from it, and how what is “missing” might pose a threat to you and your interests.

Many times I have seen seemingly innocuous provisions in agreements that – intentionally or not – change the expressed intentions and effect of the contract.

Here are some common contract provisions that people often mistakenly call “mere boilerplate,” and in doing so endanger themselves and their interests:

  • “Section Titles”: This “boilerplate” provision usually – but not always – provides that the headings or titles of paragraphs have no effect in interpretation, but are just there for the sake of convenience. So why read it carefully? Because sometimes the drafter omits the tiny word “no,” and thus changes the entire meaning and effect of the section, to its very opposite, that is, that the section titles are of meaning, and thus need to be considered in interpreting the agreement. If you don’t read the full paragraph carefully, you may misunderstand what the agreement means, leading your mind and your analysis astray.

  • “Entire Agreement”: This “boilerplate” provision usually – but not always – provides that only the words inside this agreement count, that nothing outside of it makes any difference. Why is reading this carefully important? Because sometimes other documents are inserted into this paragraph to make it say, for example “The words in this agreement and in the non-compete agreement previously signed by the parties, are and will continue to be binding.” If you failed to see that italicized language, your “boat” may be “sunk” if you get a new job, and your new employer gets a letter alleging you are violating a non-compete agreement. OUCH!!

  • “No Unsigned Agreements or Amendments”: This provision, found in many employment agreements, usually says that no oral or unsigned agreements can bind the employer, but only written and signed agreements can do so. Sometimes, though, this is added, without most people noticing: “by the employer’s CFO or CEO.” So, if this agreement, the one that contains this very provision, is not signed by the CFO or CEO, but for example by the Head of HR, then this very agreement – this entire agreement – is not binding at all on the employer. Neat trick, no?

I don’t mean to make you paranoid, and I am not trying to scare you into hiring an attorney every time you have to sign a piece of paper, but I do want to shatter any myth you may have heard or been told, especially by HR, that any words or clauses of any contract can be treated casually.

So, please bear in mind, that when anyone says that “That paragraph is nothing but boilerplate,” or “Most of this agreement is boilerplate,” as soon as you can, you should put on your strongest reading glasses, and carefully read and consider every word of it. And each punctuation mark, too.

Don’t permit yourself to be misled, don’t mislead yourself.
Nor should you “save” five minutes of reading and lose, perhaps, your career, as a result.

Forewarned is forearmed.

Need to send a model memo or letter to make a request or complaint? A good checklist or form agreement? For a complete list of our Model Letters, Memos, Checklists and Sample Agreements, Just [click here.]

Interested in Membership? It’s free, and has advantages, including discounts on our products. Just [click here.]

Need a private telephone consultation? Just [click here.] Evenings and weekends can usually be accommodated.

© 2018 Alan L. Sklover. All Rights Reserved. Commercial Use Strictly Prohibited

Key Man / Key Woman Clause – How to Protect Your Key Business Relations

Published on August 14th, 2018 by Alan L. Sklover

 
“A satisfied customer is the best business strategy of all.”

– Michael LeBoeuf

ACTUAL CASE HISTORIES: Rita was a highly regarded Senior Sales Account Manager for an industrial plumbing supplies company headquartered in Springfield, Illinois that catered to a handful of large construction firms in the Upper Midwest and Canada. Over 20 or so years, she had developed strong client relationships based in a deep trust for her good judgment and for her devotion to client interests. Her clients often said of her “If you need something, and need it ‘yesterday,’ you need to call Rita.” She had also built a small but effective support team around her.

Rita was recruited by a large competitor headquartered in Milwaukee, Wisconsin, to serve in a significant Business Development role, with the expectation that she would bring along her “Book of Business,” that is, her established network of clients and their business. While she was presented with a significant increase in compensation, she was not quite certain it was the right move for her clients, many of whom enjoyed “white glove,” personal treatment they had grown accustomed to over the years.

Wisely, Rita sought ways to protect her “Book of Business,” what some people refer to as her “B.O.B.” She sought one or more ways she could assure her clients and client referral sources that she would “be there for them” whenever and however they needed. She sought, too, a way she could always keep her support team with her.

Her primary concern was that she would join the new company and, in any agreements, somehow lose access to her critical business relations. What might happen if she left the new company, or was asked to leave, for any reason? Like most employers, her prospective employer required their employees sign to a non-compete agreement, prohibiting them from providing services to “the company clients,” which is precisely what “Rita’s clients” would become, if she let that happen.

Rita would also be required to sign a “non-solicit/non-hire” agreement, barring her from taking any members of her support team with her, in the event she left or was asked to leave.

We helped Rita solve these two problems with the use of “Key Man / Key Woman” clauses that her prospective employer reluctantly agreed to, in order to “acquire” Rita, her team, and most especially, her clients. So, if for any reason Rita left the new company, or if for any reason she was not in charge of her clients’ business, Rita’s clients could take their business – and take Rita and her team, too – to another company.

LESSON TO LEARN: As an employee, you are referred to as a “Human Resource.” I happen to deplore that term, as I find it to be a dehumanizing phrase. But, as a “Human Resource” you may be seen as a “source” of new, additional, and very valuable business from new, additional and very valuable clientele. This is precisely why we use “Key Man / Key Woman” clauses and agreements: to offer that to your employer, but to always maintain your access to your “B.O.B.,” and your “B.O.B.”‘s access to you.

Good relations with staff members, colleagues, vendors, customers and clients are of critical value in every business and profession. That is why employers try so hard in numerous ways to ensure that their employees do not “steal” them, even when it was the employee, himself or herself, who brought the client to the employer. It is beyond question that it is in your own best interests to try to keep those valuable business relations, to prevent their “theft” from you, no matter where you are, where you go, or what you do.

Having good, strong, close relations with clients and customers makes you the “rain-maker” that is one of the most important attributes of a successful business person. Having good, strong, close relations with colleagues makes you the “magnet” that can attract, maintain and take with you the best and brightest of talent. Having good, strong, close relations with support staff gives you the ability to move your business to its most fertile location and have intact, when you need it, reliable, trustworthy, confidence-enhancing support.

We see many Key Man / Key Woman clauses in contracts used by sport agents and agents for movie/TV talent. It is not common knowledge, but a good number of senior executives request in their own employment contracts that provide that, if the CEO should depart for any reason, be it voluntary, due to disability or death, or involuntary, due to misconduct reasons or otherwise, they have the option, but not the obligation, to depart free from further obligations and continuing restrictions to the employer.

“Key Man / Key Woman Clauses” are one of the best ways to protect your “key business relations.” And, if you may have the leverage to safeguard your own “key business relations,” why not at least try?

WHAT YOU CAN DO: If you have such key business relations – and so many people do – consider the use of Key Man / Key Woman clauses to protect them. Here are some very valuable pointers:
Read the rest of this blog post »

Workplace Negotiating Insight No. 15: “Standard Language” . . . There’s no such thing.

Published on April 10th, 2018 by Alan L. Sklover

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It happens to me nearly every day; in fact, it happened to me just last week. When discussing language in a legal document with an employer’s HR or Legal representative, I am told “That is standard language. So, we can’t change it.”

I know why they say that: they are fearful. You see, “long, long ago, in a land far, far away,” some attorney prepared that “standard language,” and this person I am dealing with today is fearful that, if he or she makes a decision to change it today, it could be a mistake. So, it’s easier to use the excuse of “standard language” than to use their brain to address the opportunity, problem and people counting on us to do so.

To get past that, I remind this person of three points: first, this problem is not “standard,” but arose from “substandard” events, so its solution cannot be “standard.” Second, this opportunity is not standard, so the language we need to use is not going to be “standard.” And, third, these people are unique and special, so our efforts on their behalf require unique and special language.

What am I really saying? In essence, “The people you and I represent want this problem to be solved, or this special opportunity achieved. We should try “special” hard to make sure that gets done. They deserve an extra ounce of thought and an extra pound of courage from us . . . otherwise they will not be happy with the outcome . . . or us.”

If you are ever uncomfortable with the “standard language” put in front of you to sign, and are told “It is standard, so we can’t change it,” think of these “non-standard” arguments to overcome such nonsense.

Sure, you should say it “softly,” and sure, you should say it “simply,” and, too, you should say it with “sincerity.” Get past the “standard” argument, and get to the “special” one -the one that works- you and your employer want.

You are not standard, and your employer is neither. Instead you and your employer are worthy of the effort and fortitude that this problem, solution, opportunity and situation need. It’s like buying shoes . . . they’ve got to fit your feet.

This usually works for me, I am confident it will likely work for you, as well.

Observe and Learn.
Then Negotiate.

Need to send a memo or letter? A good checklist or form agreement? For a complete list of our Model Letters, Memos, Checklists and Sample Agreements, Just [click here.]

Interested in Membership? It’s free, and has advantages, including discounts on our products. Just [click here.]

Need a private telephone consultation? Just [click here.]

© 2018, Alan L. Sklover All Rights Reserved. Commercial Use Prohibited.

Incorporated by Reference – Key Words & Phrases

Published on March 27th, 2018 by Alan L. Sklover

Key Words

What is the meaning of:

Incorporated by Reference?

In many workplace agreements, we see language that says something like this:
“This Agreement and the Confidentiality Agreement signed on November 24, 2021, which is hereby incorporated by reference, constitute the entire understanding between the parties.“

In this way, two agreements —one “new,” and one “old”— are combined into one. The simple phrase “incorporated by reference” makes it necessary to review not only the “new” agreement in your hand, but also the “old” agreement (or agreements) now being incorporated into it, which you may have signed decades ago.

So, for example, if you are given a Severance Agreement, and it “incorporates by reference” a Non-Competition Agreement you signed on your first day of work nine years ago, without realizing it, you may again be agreeing to a Non-Compete restriction that may not make sense now.

“Old” agreements may have made sense to sign then, but may not make sense to sign again, now.

Also, years ago you may not have had sufficient leverage to refuse to sign that “old agreement,” but you may now have sufficient leverage to refuse to re-sign it.

As another example, if you are given a new and seemingly generous Bonus Agreement, and it “incorporates by reference” a Reimbursement Agreement you signed six years ago, it’s just possible that that “new” bonus may just not be worth it.

In a nutshell, keep an eye out for the phrase “incorporated by reference,” and if you see it, review each of the other agreements it combines by “incorporating by reference.” Say to yourself, “Is this a wise thing to do?” Frequently, the answer is “No.”

Need to send a model memo or letter to make a request or complaint? A good checklist or form agreement? For a complete list of our Model Letters, Memos, Checklists and Sample Agreements, Just [click here.]

Interested in Membership? It’s free, and has advantages, including discounts on our products. Just [click here.]

Need a private telephone consultation? Just [click here.] Evenings and weekends can usually be accommodated.

© 2018 Alan L. Sklover. All Rights Reserved. Commercial Use Strictly Prohibited


Alan L. Sklover

Alan L. Sklover

Employment Attorney
and Career Strategist
for over 35 years

Job Security and Career Success now depend on knowing how to navigate and negotiate to gain the most for your skills, time and efforts. Learn the trade secrets and 'uncommon common sense' of Attorney Alan L. Sklover, the leading authority on "Negotiating for Yourself at Work™".

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