To Cause Agreement

Category: Allgemein

When a board decides that it must terminate a CEO`s employment relationship, the terms of the employment contract determine whether the association must pay severance pay. Carefully crafted definitions of „causes“ are essential. (A) within twelve months of the date on which the Executive Officer becomes effectively aware of any of the events that form the basis for constructive termination without cause, the Officer has notified the Board of a written notification indicating the events described in this Agreement; First, you need to understand how long your contract lasts and when you can be fired „for no reason.“ For example, if your contract is very short-term or you can be terminated „for no reason“ with a delay of thirty days, there is no point in negotiating a strong section „for an important reason“. In this case, your employer will only give you thirty days` notice as part of the contract to end your employment relationship. In such a contract, you really have a thirty-day contract (even if the duration is indicated at 2 years), because they can simply terminate it with a short delay. An „important reason“ in a contract only makes sense if the duration of the contract is significant and there are substantial restrictions (including time limitations) on termination „without reason“. If a contract limits your termination to „material reason,“ one of the top priorities is defining „cause.“ Unfortunately, many contracts submitted to employees seem to help the worker by limiting layoffs to „reasons,“ but then undermining the entire purpose by defining „cause“ to mean essentially everything the employer means by that. For example, the definition of „cause“ may include a „violation of company guidelines or procedures.“ Such a vague definition may give the employer a wide margin of appreciation in determining when an employee can be dismissed „for an immeasurable reason.“ As an extreme example, could arriving late for work be a violation of company policy? On the contrary, you should negotiate for as narrow a definition of the cause as possible. For example, limiting to very specific and serious acts that any reasonable person would accept is a ground for immediate termination. This may include conviction for a crime, fraud or theft, serious misconduct that seriously violates the business or unauthorized use or disclosure of trade secrets. In other words, bad things that if you do, you should be fired immediately. Be sure to eliminate all ambiguities.

The „for reasons“ section should be very limited, very specific and not open to debate about what what it means. Most associations have some sort of written employment contract with their general manager, although it is available in the form of a letter of offer. Whether the executive is recruited for a defined term or at his or her convenience, many executive employment contracts include severance pay provisions that are triggered when the executive is terminated „for no reason.“ From the executive`s point of view, redundancy provisions offer important safeguards and become key elements of the negotiated employment package, especially when he leaves a secure role to join a new organisation. . . .