Ask Liz Ryan HR: Human Resources for the new millennium
Ask Liz: Employment Agreements?
Dear Liz,
Who gets an employment agreement, exactly? I am interviewing for a VP-BizDev position in a fast-growing firm that has had ups and downs. I inquired about an employment agreement and the employer became very indignant. Is it unreasonable to ask for some kind of guarantee in a high-risk environment?
Thanks,
JoEllen
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Dear JoEllen,
Employment agreements become common (but by no means automatic) at the VP level, and pretty much assured for C-level jobs. I'd advise you to run from a C-level opportunity that didn't include one. In a high-risk proposition like the one you're describing, you can say "If your culture doesn't support employment agreements, let's have me work as a consultant." Your rate will increase thirty to fifty percent (some would advise a bigger delta) as a result. If you want to make this pitch, do some calculations to show what you'll produce in incremental sales and profits, then peg your rate to a percentage of that.
By the way, if you choose to propose the 'deal' for your employment agreement, you'll want to establish a payout in case your job is eliminated for some non-cause-related reason. One year's pay is standard. If the company tanks entirely, you're on your own. Cheers - Liz
Who gets an employment agreement, exactly? I am interviewing for a VP-BizDev position in a fast-growing firm that has had ups and downs. I inquired about an employment agreement and the employer became very indignant. Is it unreasonable to ask for some kind of guarantee in a high-risk environment?
Thanks,
JoEllen
----------
Dear JoEllen,
Employment agreements become common (but by no means automatic) at the VP level, and pretty much assured for C-level jobs. I'd advise you to run from a C-level opportunity that didn't include one. In a high-risk proposition like the one you're describing, you can say "If your culture doesn't support employment agreements, let's have me work as a consultant." Your rate will increase thirty to fifty percent (some would advise a bigger delta) as a result. If you want to make this pitch, do some calculations to show what you'll produce in incremental sales and profits, then peg your rate to a percentage of that.
By the way, if you choose to propose the 'deal' for your employment agreement, you'll want to establish a payout in case your job is eliminated for some non-cause-related reason. One year's pay is standard. If the company tanks entirely, you're on your own. Cheers - Liz
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