Signing an employment contract is more than a formality. It defines everything from your salary to the process of leaving your job.
In California, recent laws have nullified noncompete clauses, but other contract terms require careful consideration to avoid potential job-related issues.
Understanding contracts and essential clauses
Before accepting an offer, request a written contract outlining these critical employment terms:
- Job title and duties: Ensure that your title and duties are clearly defined and avoid vague descriptions that might lead to unexpected responsibilities.
- Compensation and benefits: Verify that salary, bonuses, payment schedule and perks – such as health benefits, retirement plans and PTO – match the offer letter.
- Employment status and hours: Determine if you are classified as an employee or contractor, as this impacts taxes, benefits and potential rights like overtime pay. Confirm your working hours and any flexible scheduling options.
- Place of work: Whether remote, hybrid or on-site, make sure that your work arrangement is clearly specified to avoid unexpected office requirements.
- Arbitration agreements: Following federal court decisions, the California law prohibiting mandatory arbitration (AB 51) has been permanently halted, allowing employers to require employees to sign arbitration agreements for most disputes as a condition of employment. Even so, you can still try to negotiate their removal or modification.
Remember, your negotiating power is strongest before you start the job. Once employed, employers may resist changing unfavorable terms.
Additional employment considerations under California law
California law generally prohibits noncompete clauses post-employment, making such terms usually unenforceable. Also, California is an at-will employment state. This means either party can generally end the work relationship at any time, except when an employment contract specifies otherwise.
Seeking negotiation assistance
Contracts are negotiable, and you have room to discuss terms. A knowledgeable employment attorney can identify hidden clauses, assist in negotiations and clarify potential risks before you commit.