I recently secured a position in a relatively new company. The employment letter that I received had a list of terms of employment, one of which is:

The terms of this letter, together with such other terms as the Company may apply to your employment from time to time in its discretion, constitute all the terms of your employment with the Company, and supersedes all previous representation, statements, understandings and contracts of service between us and you (if any). Notwithstanding the forgoing, the Company reserves the right to modify the terms of your employment from time to time in its discretion.

My lawyer is out of town for a couple of days and the company is insisting that I sign the contract at the earliest. My questions are:

  1. From the last line (in bold) - Does it mean that they can change the terms of employment on their own without my consent?

  2. If I the sign the contract now but later turn down the job offer (before the joining date), is it unethical/illegal?

I obviously want to avoid case-2 and get few days to consult with my lawyer, but I suspect it would make me look like quite a paranoid fellow.

  • 2
    This question is off-topic, since it is both a legal question and about specific company policy – David K Mar 31 '15 at 13:08
  • That being said, generally a company will modify their terms of employment from time to time, but will either notify you of the change or make you re-sign. If you don't like the changes, that's up for you to take up with your higher-ups. – David K Mar 31 '15 at 13:10
  • As @DavidK said, a legal and company specific question so voting to close, but in my non-legal opinion a fairly common clause in a contract. Yes they can change the contract but you can refuse, however you usually refuse by resigning. – The Wandering Dev Manager Mar 31 '15 at 13:38
  • that seems reasonable to me. I will discuss this contract in detail with some other lawyer I can find. – aspect Mar 31 '15 at 13:54

From the last line (in bold) - Does it mean that they can change the terms of employment on their own without my consent?

Yes, that's the idea. It's in fact not that uncommon. How much they can change will depend a bit on what else the contract states. Most likely this is to open up for changes that are required in the future. It's not like you'll sign a new contract if you're promoted, thus also given more\different tasks. This requires changes that would possibly go against points in contract, thus requiring new or changed contract.

If I the sign the contract now but later turn down the job offer (before the joining date), is it unethical/illegal?

Not illegal, but not really a nice thing to do either. You'd want to avoid that as much as possible. Usually the contract won't take effect before you start, if ever, just a day or so before set start date.

In your situation, maybe you'd be best to consult another lawyer while yours is out?

  1. Employer contracts get tweaked and fine tuned all the time, sometimes in adaptation to or in compliance with government with government edicts or as an adaptation to a changing business environment including changed employee expectations. If for example, government adds a new class of people that employers can no longer discriminate against, your employment contract will most likely be edited accordingly.

  2. An employment contract is a contract i.e. a mutual agreement. If an employer changes the terms of the employment contract, the employer will submit the modified contract to your signature. You can, of course, refuse to sign but then the employer may refuse to keep you on their payroll since there is no longer a mutual agreement on working conditions between you and your employer. You are on employer promises by mutual agreement. Absent mutual agreement, your employer has every right to feel that you no longer have any business being on employer premises and collecting a paycheck from them. I can't see any situation where in-house counsel would let you work for your employer without an employment contract and of course, an employment contract that is not signed is an employment contract that isn't in place and an employment contract that's not in place is an employment contract that doesn't exist. That's for the places that require an explicit contract, of course.

    Other places such as small businesses work on implied contracts - they change your working conditions and tell you casually that they are doing it and if you still report to work, it means that you agreed.

  3. Your employment contract should be effective on your first day of employment. If you are not on premises - or connected, if working remotely - you are not being told of the specific tasks you have to accomplish in return for your paycheck over the next two weeks and you are not being told whom you are reporting to, then you are not officially employed and you cannot represent yourself as being employed by the organization. Your contract should include a date that it becomes effective and your employment start date usually serves as your employment contract start date.

If you are wondering whether you are employed and you are in the US, the Department of Labor should be the ultimate authority on the subject since they are chartered to enforce the labor laws of your state.

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