At-Will Employment Contracts
Employment Contracts in California should be drafted carefully, because dismissal of an employee for refusing to sign an invalid or illegal contract can give rise to a wrongful termination action.
Employment Contracts allow employers to ensure that created works, inventions, and other intellectual property are automatically assigned to the employer at the time of creation as “Works for Hire”. For example, if the employee invents a patentable method during employment, the employer should have an agreement in place that specifies that all inventions are assigned to the Employer.
Employment Contracts are used to designate the preferred forum to resolve a dispute, such as binding arbitration. The employer should determine ahead of time which forum it prefers to litigate in, in the event of a dispute between the employer and the employee. There are advantages to each side of this complex question, but the specific facts of every business are different.
Protect Trade Secrets
Employment contracts may additionally be used to impose restrictive covenants on the employee, such as non-compete agreements, agreements for the employee not to solicit customers or other employees, and confidentiality. Employers should remain cognizant that restrictive covenants are highly regulated in California in order to protect workers’ rights to obtain future gainful employment.
One of the most significant steps a business can take in a business relationship is to negotiate a binding contract, as contracts form the foundation of any commercial relationship. The magic of a contract is that two parties can put their heads together and (within limits) agree to change to law as between the two parties. For instance, Party A can agree to have an obligation to Mow Party B’s lawn, as long as Party B will adopt the obligation to pay Party B $20 per week.
Moreover, a contract can be entered into with a mere verbal exchange of promises. Because it is so simple to enter into a binding agreement , many parties accidently enter into contracts, or unintentionally create business obligations for themselves or their company.
We have experience in shepherding clients through the process of negotiating and executing complex business arrangements, whether from the sale of business assets, the ongoing sale of inventory, to the purchase of capital assets.