Employment Contract Risk Check: Threat Assessment
Contracts hide risks. Broad non-compete kills future career. Clawback creates financial risk. Arbitration removes legal protection. This assessment identifies all threats.
Categories of Contract Risk
(1) LEGAL RISK: Arbitration, enforceability, dispute resolution. (2) FINANCIAL RISK: Clawback, debt liability, salary mismatches. (3) CAREER RISK: Non-compete, NDA, IP assignment. (4) EQUITY RISK: Vesting cliff, acceleration, dilution. (5) SAFETY RISK: No severance, no safety net. (6) CULTURE RISK: Company reputation, management quality.
Risk Assessment Framework
FOR EACH RISK: Rate as LOW, MEDIUM, or HIGH. (1) Is the risk clause present? (2) How broad/restrictive is it? (3) How enforceable is it? (4) What happens if it's enforced? (5) How much could it cost you?
Overall Risk Rating
LOW RISK: 0 high-risk items, some medium-risk items. MEDIUM RISK: 1-2 high-risk items or many medium-risk items. HIGH RISK: 3+ high-risk items or one catastrophic item. Recommendation: Only accept MEDIUM risk if you can't do better. AVOID HIGH RISK.
Frequently Asked Questions
What counts as "high risk"?
High risk: Career-threatening non-compete, clawback >your annual salary, forced arbitration, broad IP assignment, zero severance. Any of these = high risk.
Can I accept some risk?
Yes, most contracts have some risk. MEDIUM risk with good salary/equity: acceptable. HIGH risk: only if desperation.
How do I reduce risk?
Negotiate: narrower non-compete, reduce clawback, improve severance, opt out of arbitration.
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