Sign Your Life Away
Welcome to the working world. From now on, everything is legal or illegal, owned by someone for “good” or “bad.” When you work for someone, they expect to own your ideas, your labor and your inventions. And they don’t want you to leave with what you learned to a competitor or tell other people about how business is done.
Read Everything Before You Sign Anything
All kinds of things can be contracts. Every website and mobile application has contracts, called End User License Agreements, Privacy Policies and Terms of Service. And while you may not read these before clicking OK, contracts at work are very important to read if you choose to sign them.
The law does not ordinarily let someone defend against enforcement of a contract on the grounds that you did not read it. Just as ignorance of the law is no excuse, ignorance of what was in a contract that you signed does not let you break that contract.
Do Not Feel Pressured To Sign Anything
Things will move fast on your first day of work, but do not be pressured to sign something without reading it. Ask for time to read the contract thoroughly, or ask if you can take it home to read it (or have a lawyer read it) and you can start work as soon as available. You shouldn’t trust strangers at their word.
If you don’t sign anything, you may not get the job, but don’t sign away your rights before you can read your contract. It’s not OK to read the contract after you sign it, because you may have signed a non-compete, which won’t let you work for any “competitor” for years after you quit.
You Can Change Contracts Before Signing
Maybe nobody told you, but you are allowed to change or strike through portions of a contract that you disagree with. Of course, they may not give you the job if you change the contract, so make sure that you only modify portions of a contract that actually matter to you, literally things you would not take the job over.
You can modify the contract before you sign it and then the company must read the contract before they sign. The company can:
- Accept your changes by initialing your change, then signing the contract
- They may choose to negotiate and rewrite the contract (pretty unlikely)
- Or they will simply not hire you
Common Contracts on Your First Day
Emplyment Contracts
Some companies will have you sign a single, all encompassing contract. Some companies will ask you to sign multiple, special purpose contracts. Here are some things to watch out for.
Non-Disclosure Agreements (NDAs)
Typically, non-disclosure agreements protect the trade secrets of the business from competing companies, journalists and sometimes governments. Some NDAs will not allow you to disclose unflattering news, unethical behavior (non-disparagement clauses).
Some NDAs might require that you not disclose criminal behavior (note that these clauses are likely to be illegal, but you won’t know if it’s illegal until a government sues the company).
It’s fair for a company to protect business trade secrets (i.e secret processes and recipes) and proprietary information (i.e. big customers, marketing plans, top employees). But what else is explicitly included in the contract? Read the NDA thoroughly and judge for yourself whether it is reasonable.
Non-Compete Agreements (NCAs)
When you work at a company, you’re pretty likely to learn company secrets. A non-compete agreement usually says that you aren’t allowed to work for a “competitor company” for a year or two after leaving this company.
Important things to look for in the non-compete:
- What is the length of time you can’t work for a competitor?
- Who is considered a competitor?
Intellectual Property (IP)
If you create art, ideas or processes while creating products, you are creating intellectual property. Even novel ways to organize company resources might be considered intellectual property. Companies want to “own” all intellectual property (IP) created by their employees. For examples, it’s pretty standard that any patentable ideas that you work on will be owned by the company.
The tricky part in these contracts is that companies want to “own” every idea and creation you make while you work for them. That may include creations that you make on your own time. Let’s say you are working with friends on a video game or animated short movie. Do you wnat the company to own that creation as well?
Important things to look for in the Intellectual Property Transfer Agreeement
- What is considered intellectual property?
- Does the company claim your IP while not working in the office?
- Does the company claim ideas that you started before working for them, but are continuing to work on now?
- If you created a videogame and do updates to that videogame, does the company now own part of your videogame?
- Does the company ask you to warrant that everything you create for them is free of intellectual property lawsuits? Some open source projects (like React Native) are owned by private corporations and may encounter intellectual property lawsuits.
You must read the Intellectual Property portion of any contract to see if you are giving up any rights to creative works or ideas that you create while employed by this company.
If you are given a paper contract, strike through any portions of the contract that you can’t agree with before signing. Write in text that you feel is appropriate and sign your initials near the change.