This article is not intended to constitute, and does not constitute, legal advice with respect to your particular situation and fact pattern. Do secure counsel promptly, if you see any legal issue looming on the horizon which may affect your career or your rights. What applies in one context, may not apply to the next one. Make sure that you seek individualized legal advice as to any important matter pertaining to your career or your rights generally.
In prior articles I have alluded to the fact that many
people think being an entertainment lawyer is a romantic existence.
Yet the brass-tacks principles of employment law and the harshness of
employee severance and termination scenarios often overtake that romanticism.
Being an entertainment lawyer entails a lot more than hanging-out with
talent at celebrity premieres, on the set, backstage,
or on the tour bus. In prior
articles I have also alluded to the fact that artists often have “day
jobs” providing their paying employment to subsidize their artistic
ventures. As a New York entertainment
attorney who grew up in a show-business
family in the midst of performers, I’m used to this. Most of these
artists intend to abandon these day jobs, with or without an employment
severance package, once they get signed to a development deal, record
contract, or otherwise “make it”. But what happens in the
meantime? What if an artist works for a company that intends to jettison
him or her as an employee, rather than the other way around? What if
the company counts on using an employment severance package as a hedge
against risk of an after-occurring wrongful-termination lawsuit?
These past years have comprised a particularly bad time in terms
of employee and contractor lay-offs and firings. As a working entertainment
lawyer in New York. I
have seen many artists and others downscale and change jobs in recent
years. Many situations which used to prompt a severance package to materialize
in the prior decade, do not do so any longer. The fact of the matter
is, a large proportion of employees
and other workers misplay the handling of their job
exit, if and when it occurs, in the employment law context. In the interests
of employee and worker empowerment before the blue-ink dries on the
release and settlement agreement or other severance documents, this
article follows. Though written by me as a media and entertainment attorney
working with entertainers, the same principles apply to employment work
in other industries and sectors.
I suppose that the first rule of employee empowerment is fairly pedestrian-sounding,
but vitally important. An employee must read and review every employment
document pertaining to his or her job and career, carefully - including
the following disclaimer. The employee should secure counsel promptly,
if he or she sees any legal issue looming on the horizon which may affect
the employee’s career or rights - including legal issues relating
to employment and severance packages. As an entertainment lawyer friend
and entertainment law professor of mine used to say, “every deal
is different”. What applies in one employment context may not
apply to the next one. The employee must make sure that he or she seeks
individualized legal advice as to any important matter pertaining to
the employee’s career or rights generally. It is not uncommon
that a soon-to-be-terminated worker starts calling attorneys as soon
as offered an employment severance package.
There are attorneys, entertainment attorneys and otherwise, who routinely
handle “employee-side” legal matters. A number of attorneys
may be able to do so affordably for even a modestly-compensated employee,
in the context of a severance proposal or otherwise. An employee-side
lawyer should be accustomed to representing people who have limited
financial resources, and this is a particularly-familiar fact-pattern
for an entertainment lawyer handling artist-side work. There are parallels.
Assuming that one is not a lawyer, one should no sooner handle
one’s own legal work than handle one’s own dental or medical
needs oneself. The severance and employee-exit scenario most often entails
some analysis of employment legal issues governing the exit. Given the
economic realities faced by those in the artistic world, all entertainment
lawyers need to be familiar with these employment legal issues.
The employee should remember that most employers themselves have in-house
or outside attorneys. Indeed, the employment, severance, settlement,
release, and exit documents are most often drafted by these attorneys.
They may be entertainment attorneys, employment attorneys, litigators,
or generalists. However monikered, often an employee’s securing
of his or her own counsel is the only way to equilibrate the proverbial
scales of justice in a severance or other job-related scenario. Exploitative
and even abusive treatment of employees is unfortunately rampant in
the employment law context, including at the time of worker exit - particularly
in highly-competitive cities like New York and Los Angeles, and in highly-competitive
industries like entertainment and media as any entertainment attorney
will tell you. The good works and lessons taught by historical pro-labor
figures like Samuel Gompers should not go for naught. The employee should
not look to the employer, or the vicissitudes of chance, to protect
the employee and the employee’s own legal rights in the workplace
or in the context of a severance or other exit from employment. Rather,
the employee should empower himself or herself, and should not be inhibited
in seeking out the advice and opinions of those professionals who handle
employee-side legal work for a living.
On to the substance and detail.
The lead singer of a rock band about to step onto a live television
set is furnished a “release”, or a copyright registration
form or trademark assignment
for signature in the name of someone else as
claimant, five minutes before scheduled
air-time. The entertainment lawyer representing the singer might
cry, “No!”.
While this could sound like an entertainment attorney observation meant
only for the golden days of the Ed Sullivan Show, the rule of not signing
on-the-spot is true in the employment context and across all other subject-matter
areas and sectors as well. Like the artist, the employee, too, should
never sign any document, employment document, severance document, or
otherwise, on the spot. The employee should not be bullied into signing
on the spot, as a product of fear, or the purposeful manipulation of
same by oppressive employers or ex-employers. There are very few situations
in life where one truly must sign a document on-the-spot, and an employment-related
signature is usually not one of them. One of the only valid such situations
that I can recall from my own experience is when an attorney must sign
a stipulation on-the-spot before a judge, as the only way to preserve
the attorney’s client’s rights. This will not likely be
a situation that one will ever have to encounter as an employee or terminated
employee in an
employment severance context or otherwise. Employers typically offer
severance to terminated workers
out of fear of being sued by them, meaning that the worker often
has more leverage in the employment context than he or she initially
thinks.
It is astounding, though, as to how many people make this mistake of
“on-the-spot” signing, time and time again, in the entertainment
law context, and in the employment severance context and in the workplace
and business-world generally - even if these signatories
know better. The employee should trust his or her own instincts. If
it smells bad, it is bad. If anyone, be it a car salesman, a manager
or talent agent you’ve never heard of before, or, yes, an employer
offering an employment severance package while terminating your employee
services, waves a document at you as panaceatic – you should be
suspect. The entertainment attorney’s first instinct is that a
document waved at you for on-the-spot signing
is not worth to you the paper it is printed on. In the employment context,
if the employer presents the employee with a severance document or other
document and tries to pressure the employee to sign that document on-the-spot,
the instinctual reaction should be similar. The odds are better than
99% that the employer is trying to take advantage
of the employee in that latter case - and trying to force the employee
to thoughtlessly relinquish in haste valid and enforceable legal rights
that the employee already and otherwise possesses.
By comparison, what does an entertainment attorney do, when given or
forwarded a document intended for signature in the context of a film
rights deal, for example? The entertainment lawyer will typically indicate
to the party who proffers the document for signature: “Thank you
- my client and I will review and respond to this document”. Period.
If the “proffering” party then says: “Hey entertainment
lawyer, aren’t you or your client going to sign it now?”,
the entertainment attorney answers with a flat “No”. Although
it is possible that the proffering party will thereafter withdraw whatever
offer the document contains and take it permanently off-the-table, they
typically won’t. If they do, it probably was not an offer
worth taking anyway. This analysis also applies to written employment
severance packages, releases, and settlement agreements, just as it
does to talent agreements, agent and manager agreements, car purchase
agreements, and just about any other form of proposed contract that
one might ever be offered. Again, this rule is by no means entertainment
attorney-specific, but instead is generalizable to the employment context
and across all sectors and industries.
The protocols of professionalism create an expectation that all parties
should be given a reasonable opportunity to review a document, including
a proposed employment severance document, prior to either: (1) signing
it as written (an extremely unlikely occurrence, by the way, if a good
attorney reviews it for the employee); or else (2) responding to the
proposed document with a fax, letter, red-line comparison draft, or
mark-up indicating the receiving party’s proposed changes. This
would normally be the way entertainment attorneys would interact with
and between each other on a proposed license agreement, for example.
The two entertainment lawyers would expect careful reading and deliberation
on either end. If a proffering employer-party in the severance context,
however, instead threatens to withdraw the document “since it
wasn’t signed on-the-spot”, then they are just being ridiculous
and overbearing. The odds are, again, better than 99% that their “non-negotiable”
document would have been a legal disaster for the employee to sign as
initially proposed. Again, this observation applies to employment severance
packages, and most all other forms of proposed draft agreements in most
all contexts other than employment, too.
Some employers in the media and entertainment industry context and otherwise
even have the unmitigated gall these days to ask employees to prospectively
waive their right to a jury trial in the context of so-called “non-negotiable”
employment agreements including severance or other exit agreements,
as but one type of egregious example of the foregoing. It is jungle
out there. If one is asked to sign an employment severance agreement
with jury trial waiver or other exit document on-the-spot, it is entirely
fair and within one’s rights to say that “I will need to
review this document with my attorney”, or “I don’t
sign documents of a legal nature without attorney review”. If the
proffering party then disputes the employee’s right to legal
representation, perhaps this is someone that the employee doesn’t
want to accommodate anyway, on principle. This country’s entire
legal history was predicated, in substantial part, on the rights of
the individual, and the individual’s right to counsel. The framers
of the Constitution worked hard. It would be a mistake to let them down
now.
The next rule is a corollary to the prohibition on “on-the-spot”
signing: The employee should never believe the employer, when the employer
offers a “standard” form of employment severance agreement
or otherwise. An entertainment attorney will tell you that “standard”
is the biggest lie in the entertainment industry. It should be considered
comparably fallacious in the employment context. If the employee wants
to empower himself or herself in the workplace and in the commercial
world, what the employee needs to do is repeat the following phrase
repeatedly, like a mantra: “There is no such thing as a ‘standard
form’. There is no such thing as a ‘standard form’”.
Because, there isn’t - as any entertainment lawyer should tell
you.
Rather, “standard form”, after an entertainment attorney
on the receiving end translates it, just means “get over on you”.
Similarly, a “standard form” employment severance document
is synonymous for “oppressive and one-sided form that takes advantage
of the employee”. The employee should remember that the draftsperson
of a so-called “standard form” is probably a fairly predatory-minded
employer-side lawyer handling the company’s employment severance
protocols en masse who is under absolutely no obligation to protect
- or indeed even acknowledge or accommodate - the employee’s interests.
Indeed, the opposite is true.
The employer-counsel’s professional obligation as a member of
the Bar handling the employer-side severance work is to be a zealous
advocate of only his or her own client’s interests - that is,
the employer’s interests only. If the employee signs an employment
severance document because the other side tells the employee it is a
“standard” or “non-negotiable” form, then the
employee might as well be walking off the roof of the proverbial building
just because the employee was told to do it. The employee should not
trust “standard forms” in the employment severance context
or otherwise, or those employers who purport to furnish them. Again,
this may be an entertainment attorney observation, but it applies to
all workplaces and other contracting situations as well.
The employee should make sure to have retained copies of every single
scrap of paper pertaining to his or her employment relationship with
any company, up to and including the time of the severance communications.
The employee should not trust or rely upon the employer to give the
employee copies of - or even access to - those employment documents
and the employee’s human resources file, if and when the employee’s
work honeymoon period with the employer ends, or if and when the employee’s
services are, or are about to be, terminated in a severance or other
context. Remember that the Japanese model of “employment for life”,
and the antiquarian U.S. model of the gold watch after 40 years of service,
just simply do not apply anymore. Severance and parachutes - and these
days the absence of them too - often replace the old model of dutiful
loyalty.
Our United States work-force is more mobile and transient than it
has ever been. The workforce I see as an entertainment attorney practicing
in New York, is most decidedly such a miasma. People change jobs all
the time, with or without accompanying employment severance packages
and exit agreements. The motility of the workforce, by the way, greatly
empowers employees to seek out their market-value salary and non-abusive
working conditions – so it is not necessarily a bad thing. As
a practical matter, in New York or elsewhere, entertainment industry
or otherwise, the employee should work with the assumption that the
employee will one day have to depart every job ever taken with or without
severance, no matter how rosy the employment picture of any job looks
initially. If the employee stays at that job until retirement, more
power to the employee. Yet the employee should realize that the statistics
indicate this would be an extremely unlikely occurrence in this day
and age given current job-market employment conditions.
The employee should make sure that, prior to any severance scenario,
his or her exhaustive, fully-complete “job file” is lawfully kept
at the employee’s home - not in an office desk drawer, not in
the company’s file cabinet - not anywhere near the employment
workplace. It is astonishing as to how many employees fail to do this
simple thing. The employee should remember that the old-fashioned paradigm
of “two weeks advance notice and severance” is rapidly becoming
a vestige of the past, particularly in the media employment context
as I see it from my vantage-point as an entertainment attorney. Many
media, software, and other types of employers will now think nothing
of having an employee escorted out of the workplace by a human resources
rep, or even by security personnel, the day and even moment the employee
is terminated. Usually when this happens, the employee is not smiling
and holding a severance check when led out of the building towards the
parking lot or subway.
Why is this happening? Because employers are becoming increasingly afraid
of disgruntled employee (or ex-employee) theft of company material,
misappropriation of software, and even sabotage and former - workplace violence in rarer
cases. The employment misappropriation threat is felt particularly by
media and entertainment companies. Unfortunately, workplace violence
incidents are on the rise everywhere. Some employers see the promise
of severance - carrot-on-a-stick illusory, or not, as finally offered
- to be a hedge against these risks as well. The moral of the story
- the employee should keep perfect and thorough contemporaneous documentation
of his or her employment file lawfully, at home, well prior to any severance
scenario.
The employee should lawfully save copies of everything - offer letters, acceptance
letters, employment contracts, “non-compete” documents,
non-disclosure or confidentiality agreements, employee handbooks, time
cards or time sheets, performance reviews, expense and reimbursement
forms and receipts, insurance and COBRA documents, inter-office memos
relating to work and performance, and anything else relating to the
employment relationship with the company. The only exception would be,
the employee should not remove any material from the workplace which
is the employer’s or someone else’s property, or which the
employee is contractually or otherwise obligated not to remove from
the place of work. As an entertainment attorney handling production
matters, I expect this issue to arise often, since an employee will
usually depart while at least some non-fungible projects are still in
development or production at the employer’s premises. This question
of property ownership, intellectual property and otherwise, is sometimes
a more difficult judgment to make than it sounds. If ever in doubt -
you guessed it - the employee should seek an attorney’s advice
prior to any such removal and prior to the closure of the employment
severance or other exit documents.
Prior to the severance scenario materializing, the employee should be
making thoughtful dated written notes to the employee’s own files
and keep them at home, anytime any legally-relevant event happens during
employ - such as a supervisor expressing either approval or disapproval
with one’s work, or a fellow employee making suggestive or harassing
comments in one’s presence. These written notes should be reduced
to writing privately, immediately after the event occurs, as opposed
to a day or more later. These written notes should quote what was said
verbatim (yes, using actual quotation marks, and accurately). The employee
should not let these notes merely rely on paraphrases, if possible.
These written notes should be taken home to the extent lawfully allowed, and feasible,
by the employee, on the date of the event so recorded, and should be
stored securely in the employee’s employment file at home until
ever needed. One would be surprised to learn just how many otherwise-valid
employee-side severance-related and other legal causes must be wholly
abandoned, simply for the employee’s idle failure to make a written
verbatim record of important workplace conversations. This overall issue
arises in the context of employment attorney and entertainment attorney
work, though familiar to most all other legal practitioners as well.
For legal purposes, the employee must assume that a re-constructive
written record made in retrospect the following week instead, or a non-verbatim
note, is near-worthless relative to one taken at the moment. What the
employee wants is what is known as a “contemporaneous written
record” - that means, “at the same time as the occurrence
of the event itself”. Yes, for most forensic purposes in the
employment context, that also could include a careful verbatim written
record made by the employee five minutes after the event ends. The employment
severance dialogues themselves, if and when verbal alone, should be
reduced to writing by the employee in this fashion, too.
Finally, the last rule is a corollary to some of the others mentioned
immediately above: The employee should bring or forward a complete photocopy
(not originals) of the employment file which the employee kept at home,
to the attorney or attorneys - entertainment attorney or otherwise
- that the employee is considering to represent the employee in the
negotiation of any employment exit and severance agreement, or any litigation
or proceeding for wrongful termination of the employment or otherwise.
The employee should remember that what he or she discloses to an entertainment
lawyer or any other attorney is strictly confidential, even if the employee
never ends up retaining that lawyer to handle the employment severance
or exit agreement or any other work. This rule of confidentiality is
a serious and inviolate rule. That lawyer could lose his or her license
to practice law, if he or she ever betrays the employee’s confidences.
Accordingly, after first making sure that the lawyer doesn’t also
represent the employer on the employment severance matter (or even otherwise),
the employee should be totally candid and thorough in terms of the facts
brought to that lawyer’s attention. The employee should not “screen
out” facts that the employee thinks are irrelevant or that the
entertainment or employment attorney “would never be interested
in”. After all, if the employee is not an attorney himself or
herself, he or she could be well wrong about this type of conclusion.
It is the attorney’s job, not the employee’s, to filter
out the irrelevant from the relevant. The employee should give the lawyer
all the raw data. The matter may be the first employment severance deal
which the employee has ever lived through, but probably not the lawyer’s.
The employee should cover any packet furnished to his or her actual
or intended lawyer with a transmittal letter bearing the legend “Strictly
Confidential”, or words to similar effect. That cover letter should
include a typewritten or word-processed narrative in the employee’s
own words, of all the facts and chronology of the severance or other
employment matter about which the attorney is being contacted. The employee
should not rely upon an oral soliloquy to make his or her point. Rather,
the employee should write it all down, in legible font or typeface,
before contacting the lawyer. Again, the employee should ensure, prior
to divulging these facts to any such attorney, that the attorney does
not already represent the employer or any other party closely affiliated
with the employer on the employment severance matter (or even otherwise).
It is a small world, and the entertainment and employment law bar in
the employee’s locale may be even smaller.
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My law practice as an entertainment attorney includes state and federal
employment law matters, including terminations, severance packages,
executive compensation, settlements, releases, and other human resource
matters including those that may arise in the fields of, film,
music, television, publishing, Internet, and other media and industries.
If you have questions about legal issues which affect your career,
and require representation, please contact me:
Law Office of John J. Tormey III, Esq.
John J. Tormey III, PLLC
1636 Third Avenue, PMB 188
New York, NY 10128 USA
(212) 410-4142 (phone)
(212) 410-2380 (fax)
e-mail: brightline@att.net
https://www.tormey.org