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From The Archive

57. Beware The Cause Clause.
A little-understood clause in many job offers and employment contracts states that when you leave the company you will receive all benefits due you including bonuses, commissions, references and so on -- unless you are terminated "for cause". If you are terminated for cause, you lose certain rights and benefits.

The trouble is, few people have any idea what "cause" means. It can mean anything if it is not defined in the agreement. "Cause" could mean you offended another employee with a rude remark. It could mean you embezzled a million dollars. It could mean you didn't turn in your expense report on time.

It's up to you to insist on a reasonable definition of "cause" that limits the company's ability to give you the shaft. Consider modifying "The Cause Clause" in your job offer or employment contract to read:

"Cause" means (a) willful and repeated failure to comply with the lawful directions of the management of the company, (b) gross negligence or willful misconduct in the performance of your duties to the company, (c) commission of any act of fraud against, or the misappropriation of material property belonging to the company, or (d) conviction of a crime that is materially injurious to the business or reputation of the company, in each case as determined in good faith by the company's Board of Directors.

It's often not until you leave a company that you feel the shaft of the knife in your back. Beware The Cause Clause.

NOTE: This suggested definition of "cause" does not constitute legal advice. It is provided to make you think about an obscure term whose definition could hurt you if it's ignored. Before you sign or modify any contract or agreement, consult a qualified attorney.