How do I officially get out of a US employee contract?

by IndependentCatalogue. Posted on Sep 11, 2020    1    19

Hi, I was employed by a small US startup a year ago for some side work to get some experience. After a few months I saw it wasn't gonna work out (I wasn't getting paid because the company was barely making profits) so I slowly faded away and stopped working. The CEO was understanding. However we never officially ended our relationship (through email or something). Only some unofficial chats that hint we are no longer together. I signed a contract at the start of my work that said employment is at will. Re-reading now the contract is probably not enforceable given many clauses don't make much sense, I was naive back then and signed it regardless.

I'm planning to make a startup in the next months, and I want to be clear of any IP claims that the CEO may make in the future (highly unlikely but in case we get very successful, you never know), because I did them "while employed", (if the contract was never officially canceled I could theoretically be still employed even now right?). I'm also worried that potential investors might ask me all my previous signed contracts (to make sure the IP belongs solely to the company), but I have no official documents of the relationship ending, only the chats. So it might scare off potential investors.

I haven't talked to the CEO for quite some time. What evidence do I need in order to be clear that I'm out of this contract? Do I need to ask him for something? We have friendly relations but I wouldn't wanna go into much detail with him, just wanna get clear of the contract (which potentially is unenforceable, but I'm not a lawyer).



[deleted] 1


GaryARefuge 1

You were never paid?

Did you get any other compensation? Equity?

If not, I would imagine the contract is null and void since they never compensated you. But, yeah, talk with a proper attorney.

miteemous 1

Is the product you are releasing in the same market as his?

  IndependentCatalogue 1

No, not competing directly or indirectly. But could be considered in the same industry under a very vague terminology (but still, very different market ).

miteemous 1

I had same situation. Get a lawyer.

  IndependentCatalogue 1

I will, even though they cost a lot and the risk seems bit small but you never know..

What did they lawyer tell you btw?

Even if it can be considered relating to my previous employer (which is not, the way I see it) it has been over a year already and there wasn't even a non competition clause.

dspacey 1

Talk to a lawyer. This isn't the best place for this kind of advice.

  IndependentCatalogue 1

I see, beside the product stuff I'm mainly asking what is an official way to end an at-will employment contract.

dspacey 1

You need to give more details about your contract.

Also, as far as I know, at-will employment is created to benefit employers so that they can let people go easily. You should be able to leave the company whenever you want. Just put in your 2-week notice in an email and ask HR to end your employment.

It will be very difficult for any company to prove that your IP belongs to them, especially if you've never used their resources to create your product. You still have the freedom to work on side projects outside regular business hours.

  IndependentCatalogue 1

There is no HR, just the CEO and few others, I stopped working 1 year ago so giving notice doesn't make much sense. Didn't even have a company laptop, just my personal PC. Does that mean that I can't develop any IP on my personal PC now?

dspacey 1

It's your "personal" PC. You can do whatever you want with it. Has the company installed any software on it? If so, do a clean install of the operating system and you should be good to go.

  IndependentCatalogue 1

No just developed and pushed some code with it back then, so they probably they have the mac address of it. But since It's mine it's not considered company's property right?

dspacey 1

I'd be very surprised if they had your Mac address considering the size of the company (CEO and few others with no HR). They haven't even given you a company laptop. You're right. Your laptop belongs to you.

  IndependentCatalogue 1

I was connected to their VPN, so my guess it is logged somewhere in there..

elma3allem 2

Why not write an email to the CEO clearly stating that?

Something like “I just discovered we haven’t formally documented by departure on DATE, so I wanted to have something for my record. Best of luck.”

If it goes to litigation, it’ll all be about proving that you were working. His contract alone won’t suffice. He’ll need to show payroll or logs of work getting done. Your email is a proof for your side.

  IndependentCatalogue 1

That seems the cleanest option but it looks too official given our relationship was quite informal, so might make him bit suspicious?

In case I don't send him anything and just go with it will the no payment / no logs of work done / chats about alluding to "not longer be employed", will be enough to cover myself in case of future litigation or in case an investor wants to see previous signed contracts?

elma3allem 1

Find the best way to word it and send the email. It may not be comfortable. But if you can’t do this simple uncomfortable task, being a CEO may not be for you.

Think of it this way, at $500/hr attorney fee, you’d want to give them as much of a slam dunk as possible

  IndependentCatalogue 1

I see. You're right. Since there is not an exact day (it was a slow fade and I don't remember the exact day, but I remember the month), should I just put a random day in that month? Or leave it at: "I just discovered we haven’t formally documented my departure on [MONTH/YEAR]"