Employment Contracts Matter
Many employees do not have formal employment contracts. But many executives, senior employees, sales professionals, physicians, finance employees, startup employees, media employees, and C-suite employees do have agreements or compensation documents that create legal rights. These may include offer letters, employment agreements, commission plans, bonus plans, equity agreements, severance agreements, non-compete agreements, non-solicitation agreements, confidentiality agreements, partnership documents, or change-in-control agreements.
A breach of employment contract occurs when an employer fails to honor a binding promise. This may involve unpaid compensation, improper termination, failure to provide notice, refusal to pay severance, cancellation of equity, withholding commissions, or changing compensation terms after the employee has earned the money.
Common Employment Contract Disputes
Employment contract disputes may involve:
- Unpaid bonuses, commissions, or incentive compensation.
- Severance promised in an agreement or plan.
- Equity, stock options, profit interests, phantom equity, or carried interest.
- Termination without required notice or without “cause.”
- Disputes over whether the employer had cause to terminate.
- Non-compete, non-solicitation, and confidentiality restrictions.
- Clawback provisions.
- Change-in-control or transaction bonuses.
- Retaliatory termination designed to avoid paying compensation.
Contract Claims and Wage Claims Can Overlap
Some compensation disputes may involve both contract law and wage law. For example, unpaid earned commissions or non-discretionary bonuses may implicate the New York Labor Law as well as an agreement. In Quallen v. Impendi Analytics, LLC, a New York court addressed claims involving breach of contract and New York Labor Law issues related to unpaid compensation and vested interests. The specific result in any case depends on the documents and facts.
Executive and C-Suite Employees
Executives and high-level employees often face unique issues. They may be terminated after reporting misconduct, rejecting harassment, challenging accounting practices, or questioning illegal conduct. The employer may then try to label the termination “for cause” to avoid severance, equity, bonuses, or deferred compensation. Counsel should carefully review the contract language, board communications, performance history, compensation plans, and timing of events.
Before Signing a Severance Agreement
Employees should be careful before signing severance, release, non-disparagement, confidentiality, or restrictive covenant documents. These agreements may waive valuable claims, impose future obligations, or affect compensation. A lawyer can evaluate whether the severance offer reflects the employee’s legal leverage and unpaid rights.
Related Fingerhut Law Pages
Wrongful Termination, Wage Theft, Unpaid Minimum Wage and Overtime, Whistleblower Retaliation, Sexual Harassment.
Contact Fingerhut Law
If your employer failed to honor an employment agreement, severance promise, commission plan, bonus plan, or equity arrangement, contact Fingerhut Law for a confidential consultation.
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