Articles Posted in Severance

Employment Lawyer Deontae Wherry

Dallas Employment Lawyer Deontae Wherry

As a young athlete, I remember the phrase, “Don’t move the goalpost.” 

The phrase is often used in sports to describe changing the criteria, or goal, while the game is still in progress. Outside of the sports arena, the phrase is commonly used as a metaphor when the goal is changed after someone has begun an act or process in an attempt to reach said goal. It may be perceived that a person is placed at an advantage or disadvantage when the goal is changed. Now as a lawyer, sometimes I find myself saying, “Don’t move the goalpost.”

Austin CampbellIncreasingly, employers in Texas have been inserting what might be called “liquidated damages” clauses into employment agreements like non-competes or severance agreements. At a basic level, a liquidated damages clause is an agreement that a party to a contract will pay a specific amount if they breach some part of the contract.

There is such thing as a proper liquidated damages clause, and there are situations (especially in commercial contracts) where clauses like that are appropriate. However, when used in the employment context often they can be wildly inappropriate, and may even cross the line into being penalty clauses that you might then have to fight to overturn. Employers may even try to demand that you agree that these damages are reasonable and not a penalty, even when that is not true. The purpose of this article is to give employees a basic idea of the things they should look out for—at least, when it comes to “liquidated damages”—before signing a contract with their employer

Generally, in a lawsuit over breach of a contract the party that breached the agreement does not have to pay any more than the amount of harm they actually caused the other side. Usually the parties would need to fight over exactly what that number would be as part of the lawsuit. But in Texas, if that number would be difficult or impossible to estimate, parties to a contract are allowed to agree to a “reasonable forecast” of those damages, just in case one party does breach the agreement. To put it another way, in situations where it would probably be prohibitively expensive or flat out impossible to put an exact dollar value on how much a party would be harmed by a breach of contract, the parties can negotiate “just compensation” ahead of time. A proper liquidated damages clause should make it so the parties do not need to argue over their actual damages at all, rather than piling on top of actual damages.

rasha-zeyadehPerhaps you resigned or were terminated or laid-off. On the other hand, you may have sued your employer for discrimination or some other sort of unlawful action. Either way, one of those events caused your employer to offer you a settlement or severance agreement. In exchange for signing the agreement, you will receive a payment, but also give up your right to pursue legal action against your employer, among other things.

If you are presented with a settlement or severance agreement, it is imperative that you read the agreement carefully and, if possible, get advice from an experienced Dallas Employment Lawyer. Typically, you will be allotted 21 days to review and sign the agreement, which provides you ample time to consult with an attorney. Oftentimes, companies sneak many clauses in the agreement that may come back to haunt you. Hence, consulting with an experienced employment lawyer is important.

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