TRACEY’S PRACTICAL EMPLOYMENT TIP
OF THE MONTH*

APRIL 2009: A RECENT CHANGE IN THE LAW REGARDING AUTOMATIC RENEWAL*

An important change in New York law took place recently that employees with contracts that expire should be cognizant of. Previously, the courts held that when a contract for employment expired but the parties continued working together under the same terms and conditions the contract would automatically be extended for an additional year under the same terms and conditions.

Recently, New York’s highest court overturned this precedent eliminating a rule that provided one of the few real protections for employees under common law. By eliminating this precedent, the court has exposed employees to vagaries of employer discretion. Practically speaking, the ruling allows for discretionary changes in expected salary, bonus and benefits without any recourse unless:

1. You negotiated any extension upon expiration (please get the extension in writing, even if e-mail); or
2. You negotiated an automatic renewal provision in your contract before you joined.

Either way, you will protect yourself from discretion during these difficult economic times although the second option is preferable so as to avoid any mistakes.

Next Month’s Tip: THE IMPORTANCE OF SELF-PROMOTION

Monthly Tip Archive

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* Disclaimer: The contents of this page are for informational purposes only and nothing herein is intended to constitute legal advice nor should anything contained herein be taken or relied on as such. Each individual executive and employee has a unique set of facts and circumstances that the general discussion set forth above may be wholly inapplicable to. Only through consultation with a lawyer from our firm in which all of the facts and circumstances of an individual’s unique situation are explored and considered can a true legal assessment of your rights and remedies be ascertained. Any use of this information is taken solely at your own risk.