Much to my chagrin, most people do not seem to read the contracts that they sign. More horrifyingly, I’m watching as corporate lawyers increasingly introduce clauses that are manipulative at best, legal gag orders more often. I realize that most people don’t read click-through agreements, but I would strongly encourage everyone to at least read employment contracts and NDAs, even the ones that look like click-throughs when you show up at a company to visit a friend for lunch.
A few weeks ago, I was asked to be an advisor to a project at a company that I will not name. The company is a large, public, profitable company with hundreds (maybe thousands) of employees, many assets, and way too many lawyers. The project sounded quite interesting so I read the contract. I would be obliged to attend regular meetings (?at my own expense – it wasn’t clear?). There would be no cash or stock compensation. Yet, the kicker was this clause:
“In order to protect Company’s Proprietary Information, Board Member agrees that Board Member shall not, while serving as a Board Member, perform any consulting or other services substantially similar to the Services for any company whose business or proposed business in any way involves products or services which could reasonably be determined to be competitive with the products or services or proposed products or services of Company. In the event Board Member has any question about whether a particular project would violate this provision, before undertaking the project Board Member shall seek a determination in writing from Company, which shall be binding.”
In other words, they want me to work for free and agree to not consult for or advise any other company that is any way competitive with them in any aspect of their business. Given this company’s assets, that would basically mean that I could not consult with any company whatsoever. You have got to be kidding me.
So, I wrote them a polite note asking for clarification on this clause. Perhaps they just meant that they didn’t want me to do work in any way that would conflict with just that specific project? They told me that I should seek private legal counsel to analyze the contract because they cannot give legal advice. So now they want me to pay a lawyer to interpret a contract so that I can work for free as an advisor while not being able to work for anyone else in the industry? Needless to say, I said no thank you.
My other favorite contract moment came when I was on a panel with Cory (the master of contract rebuttal). The contract was insidious. Amongst many other problems with that contract, they claimed rights over any IP that I would introduce during my talk and made us legally and financially liable for all sorts of things. Needless to say, Cory and I both refused to do the event until they amended the contract. Their response was that no speaker had ever refused that contract before. ::jaw on floor::
We have become an immensely litigious society. As a result, lawyers shove contracts down our throats left right and center. Most people are not trained to interpret these so they are expected to hire lawyers to do so. (Not so bad for the legal profession, eh?) This really upsets me. Are there ways that average people can learn to interpret contracts and push back at them? I’ve gotten better at it after having read so many of them, but I don’t think most people know. I also think it’s important that people learn to reject contracts. I reject most NDAs. I won’t sign them because they are usually so broad that they put me at risk in every direction. I can’t imagine journalists sign them, do they?
I vote that there should be a “stupid contracts” equivalent of Chilling Effects because I think that these contracts are also chilling participation of all sorts.
In the meantime, I’d like to encourage everyone to read those nasty contracts. And stand up for your rights. Don’t just sign them. And don’t just assume that they won’t actually enforce them. That’s not a good standard to set. This is particularly critical for academics and others who subsist on freelance work and the intellectual output they produce. And if you’re a company, think about the nasty contracts you’re imposing on people. Does your legal team need to be that psycho? My hope is that if people start reading and refusing, companies will rethink their policies. But it all starts with reading the damn thing.