1. Compensation and Benefits
- ☐ Is the base salary clearly stated — and does it match what was discussed?
- ☐ Are bonuses defined with objective criteria, or are they entirely discretionary? 'Discretionary' means they can pay you zero.
- ☐ Are equity/stock options detailed — number of shares, vesting schedule (typically 4 years with 1-year cliff), and exercise window after leaving?
- ☐ Is the benefits package described — health insurance, 401(k) match, PTO, parental leave — or just referenced as 'standard benefits'?
- ☐ Are there any clawback provisions that let the company take back compensation under certain conditions?
💡 Tip: If the offer letter says 'eligible for a bonus of up to X%' but doesn't define how the bonus is calculated, assume the minimum. Discretionary bonuses are not guaranteed compensation.
2. At-Will Employment Status
- ☐ Is your employment explicitly 'at-will,' meaning either party can end it at any time?
- ☐ Does the contract override at-will status by requiring 'cause' for termination? If so, what counts as cause?
- ☐ Is there a fixed term (e.g., '2-year contract')? Fixed-term contracts may limit your ability to leave early.
- ☐ If you're in California, New York, or another employee-friendly state, are there state-specific protections the contract should acknowledge?
3. Non-Compete and Non-Solicitation
- ☐ Is there a non-compete clause? If so — how long, what geography, and what industries does it cover?
- ☐ In California, non-competes are generally unenforceable. In other states, they must be 'reasonable in scope.' Is yours?
- ☐ Is there a non-solicitation clause (can't recruit former colleagues)? How long does it last — 6-12 months is typical.
- ☐ Do any post-employment restrictions apply regardless of why you left — including if you're laid off or fired without cause?
- ☐ If you're a freelancer or contractor, are there restrictions on working with other clients in the same industry?
💡 Tip: The FTC voted to ban most non-competes in 2024 (effective 2025). While legal challenges continue, overly broad non-competes are under increasing scrutiny. Push back on ones that unreasonably limit your career.
4. Intellectual Property Assignment
- ☐ Does the contract assign ALL inventions and IP to the company — including things you create on your own time with your own equipment?
- ☐ Are there carve-outs for pre-existing IP (your prior work, open-source contributions, side projects)?
- ☐ Does your state have an invention assignment statute (like California Labor Code § 2870) that limits what the company can claim? The contract should reference this.
- ☐ If you're a software developer, does the contract claim ownership of everything you code — even personal projects done outside work hours?
💡 Tip: IP assignment clauses often use 'hereby assigns' language — present tense, meaning it takes effect immediately. This means ideas you have during employment, even on weekends, could belong to the company. Negotiate clear carve-outs for personal projects.
5. Confidentiality Obligations
- ☐ Does the employment contract include confidentiality obligations that survive after you leave?
- ☐ Is 'Confidential Information' reasonably defined, or does it cover 'any and all information' about the company?
- ☐ Are there standard exclusions — public domain info, prior knowledge, independent development?
- ☐ Does the confidentiality clause overlap with a separate NDA you're also being asked to sign? Avoid double obligations.
6. Termination and Notice Period
- ☐ How much notice must the company give you to terminate? Two weeks is typical; 30+ days is favorable.
- ☐ How much notice must YOU give? Is it the same? If the company needs 30 days but you only need 2 weeks — that's fair.
- ☐ Can the company terminate you immediately 'for cause' — and is cause broadly defined to include vague reasons like 'unsatisfactory performance'?
- ☐ If you're terminated without cause, do you get paid through the notice period? This should be explicit.
7. Severance Terms
- ☐ Is there a severance package, or is severance not mentioned at all? If not mentioned, assume zero.
- ☐ Does severance require you to sign a release of claims (waiving your right to sue)? This is standard.
- ☐ Is severance conditioned on compliance with post-employment restrictions (non-compete, non-disparagement)?
- ☐ For executives and senior roles — is there a 'golden parachute' or change-of-control provision if the company is acquired?
8. Dispute Resolution
- ☐ Is there a mandatory arbitration clause? If so, you're waiving your right to sue in court or participate in class actions.
- ☐ Are arbitration costs split, or does the company pay? Employer-paid arbitration is more favorable.
- ☐ Is there a jury trial waiver? This is common but limits your legal options.
- ☐ Is there a class action waiver? Most employment contracts include one — understand what you're giving up.
9. Governing Law and Venue
- ☐ Which state's law governs the contract? If you work remotely in Texas but the contract says Delaware law applies — you need to understand why.
- ☐ Is the venue for disputes in a location that's convenient for you? A venue across the country makes it expensive to enforce your rights.
- ☐ If the company is headquartered in another state, does the contract require you to litigate there?
10. Amendment and Entire Agreement
- ☐ Does the contract state it's the 'entire agreement' between you and the employer? This means prior verbal promises may not be enforceable.
- ☐ Were any promises made during interviews (remote work, promotion timeline, equity refresh) that aren't in the written contract? Get them in writing.
- ☐ Can the company unilaterally amend the terms? Some contracts say 'the company reserves the right to modify this agreement at any time' — push back.
11. Hidden Clauses to Watch For
- ☐ Non-disparagement — can you say anything negative about the company, even after you leave?
- ☐ Moonlighting restrictions — can you work a second job, freelance, or serve on advisory boards?
- ☐ Social media policy — does the contract restrict what you can post on personal accounts?
- ☐ Relocation clause — can the company require you to move? If so, who pays?
- ☐ Background check consent — ongoing or one-time? Ongoing background checks are increasingly common but should be disclosed.
💡 Tip: Employment contracts often contain clauses that seem minor but can have major consequences. A non-disparagement clause, for example, could prevent you from leaving a Glassdoor review — even an honest one.
How to Use This Checklist
Go through each section in order. For any item that raises a concern, mark it for negotiation. Remember: employment contracts are negotiable — especially for experienced hires and specialized roles. Companies expect some back-and-forth.
Not sure where to start? Upload your employment contract to our free AI employment contract reviewer. It checks for all 12 points automatically — flagging non-compete concerns, IP overreach, and one-sided terms in under 30 seconds.
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