Last week, Ken Adams was kind enough to provide us with a great guest post on using the clause “moral turpitude” in employment contracts. If you haven’t read it yet, take a minute to do so.
I agree with Ken that the phrase “moral turpitude” has some issues and should be used sparingly in employment contracts.
But what is good in theory may not work as well in practice.
Take a company that has used such a phrase in their contracts for years. It now wants to abandon that phrase for all contracts going forward; all very well and good but how will that change affect interpretations of existing contracts? And if it has dozens of contracts, how does it keep track of the changes?
Moreover, while the clause may be vague, the company may not have had any disputes about the scope of the clause before. Why rock the boat?
Or take an executive who is the recipient of a company’s version of a contract that has the clause in there. Is the executive going to go to battle over a phrase that will likely never come into play?
Thus as a result, companies and executives do not have a significant incentive to remove that clause from the contract. A search of publicly-available executive contracts shows plenty of examples of that phrase still being used repeatedly.
What is an employer to do? Employment agreements need not be static creatures. Indeed, the best contracts are the result of years of revising to improve upon language when issues develop. And when your existing contracts are up for renewal, use it as a time to clean up language that could use some additional clarity. The use of “moral turpitude” is not so risky as to merit wholesale revisions but if you are starting from scratch, use it as an opportunity to find language that is simpler and easier to interpret.
There is no simple path to contract drafting. But by paying attention to the words that you use, there’s nothing that prevents you from simplifying your contracts.