Thanks to all who came to our Labor & Employment seminar on Thursday. Our biggest crowd yet. In it, we talked about the importance of offer letters.  Marc Herman returns today with a post updating us on a recent Connecticut Supreme Court decision that came out while I was on vacation a while back that

Just a quick followup today on a post from last month.

As I reported then, a District Court judge dismissed a closely-watched EEOC lawsuit against CVS challenging a pretty standard severance agreement.  But the grounds for the dismissal were unknown back then.

The wait is over; the written decision was released yesterday.  For

My colleague Chris Engler reports today on a new Connecticut Appellate Court case that focuses on a often misunderstood concept in employment contracts — the need for “consideration”.  What was it that Dire Straits’ sang about in the 1980s? Getting “Money for Nothing”?

We’ve all been told that you can’t get something for nothing.  That lesson was reiterated in a new case by the Appellate Court due to be officially released next week. 

The Facts

As told by the Court, the facts of the case,  Thoma v. Oxford Performance Materials, Inc., revolve around the employer’s attempts to attract investors. 

One investment company told the employer, Oxford, that it wanted assurances that key personnel would not leave.  Oxford dutifully entered into employment contracts with various employees, including Lynne Thoma.

The details of the contracts are important.  This first employment contract gave Ms. Thoma a higher salary, job security (termination could only be with 60 days’ notice), and a severance package.  In return, Ms. Thoma promised not to leave during the contract period and not to work for a competitor for six months after leaving.  Ms. Thoma signed this contract.

 At this point, both parties had gotten a benefit, and all seemed well.

But then a second investment company informed Oxford of its dissatisfaction because the employment contract was “too strong.”  So Oxford went back to the drawing board and crafted new contracts.

 Ms. Thoma’s second contract was quite different.  It removed all of the monetary elements, including the salary increase.  The new contract also allowed Oxford to fire Ms. Thoma without notice or cause.  Finally, it prohibited Ms. Thoma from working for a competitor.  (The length of this prohibition was unclear.  If you’re a contract jargon junkie, I recommend reading the court’s analysis in full.) 

Nevertheless, Ms. Thoma went ahead and signed this contract as well.

A year later, Oxford fired Ms. Thoma.  She demanded the benefits from the first contract.  Thus commenceth this case.

Is the Second Contract Enforceable?

Ultimately, both the trial court and the appellate court sided with Ms. Thoma, concluding that she didn’t receive any consideration in exchange for the sacrifices she made in the second contract.  In other words, she gave up some perks without getting anything in return.


Continue Reading “Consider” This Important: Employment Contracts Are a Two-Way Street

Back in June, I talked about the standard that courts will follow in deciding whether or not to enforce a non-compete agreement between an employer and an employee.  (Go read it here first.)

But many employers want to know something more straightforward: How long can I make the restrictive covenant in my agreement; in

So, remember back in February where I noted that employers ought to “consider having an attorney review some of your [employment] agreements … [because sometimes,] poor drafting can sometimes be avoided by having an attorney involved”?

We have another appellate court case that emphasizes that point quiet well in Stratford v. Winterbottom.

The

I’ll first acknowledge the obvious: UConn’s national championships in both men’s and women’s basketball is a weak excuse for a post on employment law topics.

And yet, that hasn’t stopped me before. (See 2009, 2011, etc.)

For Kevin Ollie, the victory provides a nice financial bonus to him.  How do I know this? Because

The law is mightier than the pen?

Rather than tell you the result of a new Connecticut Supreme Court case first, let’s play along with the facts at home first.Here they are:

The plaintiff was hired as a laboratory manager by the defendant in February, 2006. On February 2, 2006, the