Pre and Postnuptual Agreements: Employment Contracts in the 21st Century

• How has the employment contract changed in the 21rst century?
• What are the expectations during the hiring process?
• What are the expectations once you are employed?
• What should you consider during these complex negotiations?
• What should you put in writing?

This month, two of my nephews are getting married; one wedding will be in USA and one will be in Israel. This has inspired me to think of the similarities between marriage and employment.

Disclaimer: for the purposes of this article, the terms pre and postnuptual agreements will be used loosely, not literally. This post, neither endorses nor decrees marital or employment agreements. Additionally, both marriage and employment norms are culture-bound constructs. For the purposes of this article, I will only review American employment norms.

When you think about marital agreements, like prenuptial agreements, what comes to mind? What are the key components of such an agreement? Who has the leverage? What are the terms, which the parties want to negotiate and put in writing? How does this relate to a persons’ optimism or cynicism about the relationship?

When you think about postnuptual agreements, what comes to mind? What are the key components of such an agreement? Who has the leverage? What are the terms, which the parties want to negotiate and put in writing? How does this relate to a persons’ optimism or cynicism about the relationship?

In the not so distant past, marriages were long-term. Today this is a rarity. Previously, there was an implicit contract between employers and employees. The unspoken contract assumed offer and acceptance from both parties. The employee provided their skills and and their loyalty and in exchange, the company took care of them. Most employees used to work for a given employer for much of their working life. The employer took care of their careers, their promotions, their salaries etc. There was a great deal of stability. There were also a tradeoff. There was a much less flexibility in company choice, choice of profession, and choice of geographic flexibility. Up until the middle of the 20th century, most employees were men and they simply followed in their fathers’ career footsteps. Before you begin longing for the ‘good ole days’, think about the impossibility of career change and career transition. Also, consider the amount of societal stigma attached to employees who changed jobs often. The 20th century definition of ‘often’ is not the same as the 21rst century definition of ‘often.’

In the 21rst century, few would deny that this implicit contract between employer and employee is broken. Additionally, the paternalistic concept of an employer taking care of their workers is an anachronism, which harks back to the industrial age.

In many ways, an offer of employment is similar to a marriage proposal. In a marriage proposal or offer of employment, the parties are setting the foundation of a mutually beneficial, and cooperative relationship. Both at work and in a marriage, people experience an initial honeymoon phase, where everything is great. In some situations, this ends much sooner than desired! Ideally, the offer is proffered in good faith and is a long term offer. However, with rapid global, economic and technological changes, this may not be the case. In an ideal world, getting the terms and conditions of your marital assets or of your employment needs in writing, would not be necessary. The similarities don’t end there. The current divorce rate for Americans is high.

The average tenure rate for an American worker is under 4years. My guess is that the current recession in the USA has impacted both employment tenure statistics and divorce rates, in a negative manner.

In an ideal world, both types of relationships would have a much, much, longer lifespan. In our grandparents or maybe parents’ generation, both marriages and employment were much more stable. Both ‘institutions’ lasted throughout much of a person’s productive years. Of course, there was a lot less wiggle room. Options for ending either of these relationships ‘prematurely,’ were not societally endorsed. There was a lot of stigma related to divorce and job change. What is an acceptable amount of job change or job tenure has shifted greatly, in the final quarter of the 20th century and beyond. Some of us may think this is a shame. Some of us still lament this loss. However, it is a reality.

Salary negotiations before being hired, or while employed are comparable to pre and post nuptial agreements. Hiring negotiations, during the interview phase can be compared to pre-nuptual agreements. There is a lot of hope, a lot of excitement for the relationship and there is also the X factor. By the X factor, I am referring to the employees’ creative potential, at a given role, company and division. This is an unknown and can work in your favor during negotiations.

Considerations for a ‘Pre-nuptual,’ pre-employment offer letter.
If you are in a “right to work” state, in the USA, then there isn’t an official employment contract. Right to work technically means that neither the employer, nor employee is bound to the other. However, I would encourage all new employees and employers to write up an “acceptance letter.” Know the exact nature of your work role and job description – before accepting an offer. This type of letter should outline the work duties and responsibilities, the hours of employment, salary rate, location of employment and reporting structure. Both parties, employer and employee should sign the letter. In my experience, any promises made during the interview process, need to be in writing. Company revenues may change, conditions may change and often, management may change. As a result, there may not be any record or institutional memory of these pre-employment, interview promises. As an employee, I always offer to write up the employment letter. This is in my best interest. Each party can modify it and initial it, before the final signing. If you are hired at a lower salary than you would like, ask for a clause related to salary. Ideally, performance reviews are tied to salary and occur at regular intervals. Include this information and the range or percentage salary increases you can expect. Of course, this is all predicated on your exemplary, work performance.

Considerations for a ‘Post-nuptual,’ post-employment, annual review or renegotiation.
There is a big difference in the scope, quality and tone of negotiations at the beginning of a relationship versus once a relationship has been established. Any of us who have ever gone through a performance review or who have petitioned for raises, know this process intimately. Yearly performance reviews, salary reviews, job reviews can be compared to postnuptual agreements. You are already employed and both sides already have implicit and explicit expectations. There is also more emotion at play and the stakes are high. Post employment negotiations can cover such issues as yearly raises, bonus and also even modification of the terms of employment.

See my article about Performance Reviews in a Recession and the Four types of Managers

Many of us, have lived through th
e challenging experience, of performing job duties which were never part of our job description. Many of us, have seen our actual jobs change so rapidly through the course of employment that they no longer resemble what we were hired to do. Sometimes, employers write a clause in the initial job offer letter, stating “duties as assigned.” However, if these unknown and additional duties take up a substantive amount of your time, are ongoing and are at a level above your job description – re-negotiate. If these duties are not temporary, but are now an ‘assumed’ part of your job, request a meeting with your supervisor. Discuss expectations, re-access your employment classification and perhaps, also your pay-rate.

While it is true that employers expect more of employees, in tough economic times, expectations should be reasonable. Even if a salary raise is not possible, what about a title change, flex time, vacation time, work from home time? I have successfully, coached clients through this trying, process. From my experience, the tone of the meeting, and the tone of how you present this information, is more important than the content of what you say. This is not an easy conversation, to have. However, unless you want to be a resentful employee or to have a resentful employee, this type of post-employment re-negotiation may be necessary.

Best wishes for your pre and postnuptual employment agreements!


Author:

© 2010 – All Rights Reserved – Sharon B. Cohen, MA, Counseling Psychology, CPRP. Licensed Counselor. Career Counselor and Career Transition Specialist. Atlanta, GA. “Helping business professionals, reach their career potential!”

Complete Archive of my Career Articles http://www.mycareermanager.blogspot.com/
On LinkedIn: “Sharon B. Cohen” On Twitter: “Mycareermanager”

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