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Negotiating and addressing termination obligations, rights in employment contracts

Last time, we looked at the case former Queens Library president Thomas Galante, who was terminated under extraordinary circumstances in connection with accusations of embezzlement. Although we don’t know exactly what contractual rights Galante may have had concerning termination from his position, it is often the case that high-level executives have special protections from termination at will.

For ordinary employees, there is typically no promise from the company that the employee has special protections from termination. For executives, the general rule of “at-will” employment is often modified by contractual agreement. The extent of job-stability arrangements executives have with their employers varies, partially because executives typically have more of an ability to negotiate the terms of employment agreements, and partially because of differences in the nature of the employment itself. 

Typically, employment agreements deal with the steps that need to be taken, the conditions that need to be met, if employment is terminated by the executive or the company. In many cases, employment agreements require executive level employees to provide notice to the employer of termination when there is no cause for the termination.

Executives may have the ability to terminate the employment agreement without notice when there is a good cause, however that may be defined. Employment agreements also typically have terms specifying the employer’s rights with respect to termination with and without cause, and what compensation is due to the executive upon termination.

Executives can benefit greatly from legal representation both when negotiating such agreements, and when seeking compensation for wrongful termination under these agreements. In our next post, we’ll continue looking at this issue and the role an experienced attorney can play in navigating the legalities of termination under executive level employment agreements. 

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