What to check in a new employment contract before you sign | Work It

Negotiating Notice Periods [0:43]

• Notice periods are contractual and binding, but can be negotiated.
• Options include asking future employers to buy out the notice period or clearing leave.
• Employees can also negotiate directly with HR to shorten the notice period.

  "It really is not. It's about having a sensible discussion, knowing what you bring to the table, what they want, why they are trying to hire you, and then trying to find a nice balance in there that works for them and for you."

Salary in Lieu of Notice [2:29]

• The Employment Act allows parties to buy out the notice period through salary in lieu of notice.
• Future employers often fund this buyout if they need the employee to start urgently.
• Unilaterally deciding to serve less than the agreed notice period is not permissible.

  "The Employment Act actually provides for the option of both parties to be able to buy out the notice period. And this is called salary paying, paying salary in lieu of notice."

Documenting Agreements [4:06]

• While oral agreements for shorter notice periods are common, getting them in writing is crucial.
• A simple email confirming the agreed shortened notice period and last day of work is recommended.
• The content of written communication must be explicit and unambiguous to be effective.

  "The conservative approach, the sound advice would be, after the meeting, when you come out, just drop a short email to say, as we discussed, we've agreed that I will only serve two months out of the six."

Enforceability of Non-Compete Clauses [7:35]

• Non-compete clauses, or post-termination restraints, are more common for senior or specialized roles.
• Enforceability hinges on protecting a legitimate proprietary interest and being reasonable in duration, geographic scope, and activity.
• Courts look at the substance of the role, not just the title, to determine infringement.

  "The first consideration is whether the employer is trying to protect a legitimate proprietary interest, whether they're trying to protect business interests."

Notice Period vs. Non-Compete [8:45]

• Notice periods are common and largely enforceable, with statutory minimums if the contract is silent.
• Non-compete clauses are post-termination restraints, typically for more senior employees.
• The duration of a non-compete period can be offset by any notice period or garden leave served.

  "Notice periods are far more common. They exist in almost, you know, most employment contracts."

Reasonable Notice Periods [10:30]

• Courts generally do not assess the reasonableness of notice periods as they are contractual undertakings.
• The focus is on the agreement between parties and the option to buy out the notice.
• Even long notice periods like six months are generally upheld if contractually agreed.

  "The courts don't normally assess the reasonableness of the notice period because it is something that has been agreed and there are ways out of it."

Negotiating with HR [13:05]

• If HR insists on a standard template, explore the possibility of a side letter or email to vary terms.
• Companies may resist customizing contracts to manage multiple versions and simplify due diligence.
• Negotiation success depends on understanding your leverage and focusing on critical terms.

  "At a very practical level, some companies are very large HR deal with a lot of contracts and if everyone comes in and wants us to customize for them you then end up running multiple different employment contracts which is a nightmare for HR to manage."

The Art of Negotiation [15:52]

• Negotiation is a skill that requires practice and developing a thick skin.
• Start by asking for what you want, but be mindful of the employer's responses and dynamics.
• Avoid pushing too hard, as it can create an impression of being difficult.

  "It's like building a muscle you have to do it often it's developing that thick hide to go and ask for what you want."

Recognizing Your Worth [17:44]

• Understand that both employer and employee benefit from the employment relationship.
• Recognize your own worth and leverage it to negotiate for better terms.
• Employers often have a "buffer" of flexibility that can be accessed by asking.

  "They are also benefiting by bringing you on board so recognize your own worth bring that to the table when you're negotiating and recognize when that can help you get more than what they're offering in the first place."