Moving from one organisation to another, whether alone or as part of a bigger team, can be traumatic. Excitement about career progression or advancement, new opportunities, and greater reward (financial or otherwise) is often tempered by concerns over the unknown - new office politics, the need to prove oneself again and the sadness at leaving trusted colleagues or mentors behind.
Our top 3 tips are below.
Read the contract – no, really read the contract!
It is staggering how few people read their service agreements or employment contracts – even at the most senior C-suite/MD level. Even if you feel that you lack the leverage to negotiate, at least take the time to read the commercial terms and consider how closely they reflect the ‘pitch’ by the headhunter or the recruitment team.
Consider in particular:
Probationary periods – normally more suitable for junior employees than senior executives where significant due diligence will already have been conducted in terms of revenues, P&L, and book size, for example. Consider whether this should be removed.
Bonuses, Carry, and Equity - is the promised guarantee a guarantee in writing? For most people – particularly those in Financial Services - the answer is likely to be no. What assurances or conditions can your team build into the contract? Beware of agreements to agree.
Benefits – what are they, what is covered, and who is covered? Think about pre-existing conditions and that knee surgery you keep putting off!
Post-termination covenants – it may seem odd to think about leaving at the point of joining but it is vital to check both your existing covenants and proposed covenants. Existing covenants probably need to be disclosed to your new employer in any event.
Most importantly, approach the contract as an opportunity to get to know the organisation – their values and their priorities. Lots of companies use off the shelf one-size fits all contracts but, for those that don’t, the drafting of the contract is likely to be a reflection of their core values. Use the process of negotiating a contract as an opportunity to learn more about who you will be trusting the next instalment of your career to.
Endings matter – think about how you want to leave your existing company
It is easy to get lost in the deal when moving firms – particularly where executive search firms are involved. Everyone’s energies are rightly put into the new terms. However, it’s a small world and relationships do matter.
Even in circumstances where your lateral move has been triggered by anger or injustice at recent events, take some time to reflect on the bigger picture. Are these relationships you will need in the future? Even if they aren’t likely to be of use to you, how will you feel in 6-12 months’ time? Apply the ‘looking in the mirror’ test.
Beware of damaging future relationships before they start. An overly aggressive approach to negotiation may be counterproductive. People work with people, not paperwork. Many of your absolutely must-haves can be secured over time - once people know and trust you.
Demanding it all before you even start may be harmful in the long term, even if you manage to get something down on paper. Remember, the contract is only a small part of it - you still need to be let through the door on day one and actually work together prosperously.
For help and advice on this topic or related issues, please contact any member of SA Law’s Employment Team.