Mark up a sample contract

You will mark up an employment contract with the clauses to accept, query and negotiate.

Reading a contract clause by clause, as you've done in this module, is slow the first time. Marking one up is how you make it fast. A marked-up contract shows, at a glance, which clauses you're fine with, which you need explained and which you want changed, and it turns straight into an email.

This exercise takes about 30 minutes. Use your own contract or a job offer you've received. If you don't have one to hand, use the sample contract that comes with this course. You need a highlighter or a PDF tool that lets you highlight and comment, and the notes you made in lessons 6.1 to 6.4.

Kai Wen marked up the full contract that arrived after his email in lesson 6.4. His version is the worked example below.

Step 1: highlight the clauses that matter

Read the whole contract once without stopping. Then go back and highlight five kinds of clause:

probation and notice, including salary in lieu and any rule on leave offsetting notice every bonus, incentive or extra payment, and any clawback or training bond restrictive clauses: non-compete, non-solicit, non-dealing and confidentiality anything that refers to another document, such as an employee handbook, a policy or a separate agreement any key employment term from MOM's list that's missing or vague

The last two are easy to miss because they're about what isn't on the page. A reference to "company policies" is a pointer to rules you haven't seen yet, and a missing term is a question you haven't asked.

Step 2: mark each clause accept, ask or negotiate

For each highlighted clause, choose one of three marks and write a one-line reason beside it.

Accept means you've read it, you understand it, and you're comfortable with it. Ask means you need it explained or confirmed before you can decide. Negotiate means you understand it and want it changed.

Be selective about negotiate. If you mark everything, nothing stands out, and the employer has no way to tell what matters to you. Most clauses in a fair contract are accept. Save negotiate for the one or two that would really cost you.

Step 3: build the clause table

Put your marks into a table with four columns: the clause and its number, what it says in your own words, your mark, and the reason. Writing each clause in your own words is the real test. If you can't, it's an ask.

Here are some rows from Kai Wen's table. Probation, clause 3: three months, extendable by three, one week's notice either side. Accept, because short notice during probation suits him too. Notice, clause 4: one month after confirmation, salary in lieu allowed. Accept. Thirteenth month, clause 6: contractual, pro-rated in year one, not paid if serving notice on payment date. Ask, to confirm whether "serving notice" includes notice given by the company. Sign-on bonus, clause 7: S$10,000 clawed back pro rata over 24 months on resignation. Accept, since the recruiter had already confirmed in writing that it didn't apply if the company ended his job. Non-compete, clause 12: twelve months, Southeast Asia, any competing business. Negotiate, because it would rule out much of his field; he'd ask for six months and direct competitors only. Handbook, clause 15: the handbook forms part of the contract and can be amended. Ask, how changes are communicated.

Step 4: draft the email

Turn every ask and negotiate row into one short, polite email to the hiring manager or HR. Group the questions, number them, and keep each to a sentence or two. Put the negotiation points last, and propose a specific alternative rather than objecting. "Would the company consider limiting clause 12 to six months and to direct competitors?" is easier to say yes to than "Clause 12 is too broad."

Kai Wen's email had four points. Two were questions, about clause 6 and clause 15. One was the non-compete proposal. The last asked for written confirmation that leave could offset notice by mutual agreement, which the recruiter had agreed on the phone in lesson 6.1. That's the kind of promise worth getting in writing before you sign.

Then read your email once as if you were the person receiving it. Is every question clear without the contract in front of you? Is the tone the one you'd want from a new colleague? Cut anything that sounds like a complaint.

What done looks like

You finish with three things. A marked-up contract, with every key clause highlighted and marked accept, ask or negotiate. A clause table with your own summary and a one-line reason for each mark. And a drafted email, with your questions and at most one or two negotiation points, ready to send.

If you're marking up a contract you signed long ago, the email may be shorter, or just one question for HR. That's still worth sending, because a question asked while nothing is at stake gets a calmer answer than one asked during a resignation.

Mark up the contract, complete the clause table and draft the email with your questions.

Course

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