Employment Contract Legal Review

curious

We are a large company with offices in about 34 locations. All of our sales representatives are asked to sign a 10-page employment compensation agreement which outlines their duties and obligations, compensation, etc. One of the sales reps in Arizona said that it is a law that if an employee in Arizona is asked to sign a contract, the employer is obligated to pay for them to have it reviewed by an attorney if the employee desires to do so. We have never heard of such a thing. Does anyone know about this or any other similar law in other states?

Gar

I'm not in Arizona, but it sounds off the wall to me. Why not ask the employee to show you this law?

Theresa Gegen TX

I don't know about that particular law, but if your contract covers several states and has a non-competition clause, you can bet that it will be invalid in some of the states (this is a very state specific clause). If you want it to be enforceable in all of the states, you need to have your attorney or have attorney's in each of the states, review it for compliance. Don't assume that you in-house lawyer (if you have one) has already reviewed the law of the other states -- he or she may not realize that it needs to be reviewed by state. I deal with lots of unenforceable non-compete agreements written by attorneys in other states.

Also, if you have any employees in California, it would be wise to have an attorney their review the agreement (California's laws are very different than most states).

Good Luck.

Rob S

I'm in Arizona, and I've never come across anything even close to that, and our company has around 70 agents who have signed agreements with our company. I'm no lawyer, but I pretty sure someone is pulling your leg. In general, the laws in Arizona favor the employer, not the employee.

Hope this helps.

Jane Reddin AZ

Greetings from Arizona! There is no such law. This is probably an example of "a little knowledge is a dangerous thing." It certainly is a better practice to allow the employee some time to review any proposed contract, and certainly they have the right to have an attorney of their choosing review it for them . . . but the next step is a little over the top; there certainly is no law in Arizona that would require you to pay for your employee's counsel's review.

Good luck!

Jane Reddin
Lewis and Roca LLP
Phoenix - Tucson - Las Vegas