Legal Question in Employment Law in Pennsylvania

Consulting Firm Replacement Fee

Hi,

I work for a consulting company and I've been on an assignment with a large university for 3.5 yrs. now. I work in the Finance Division in the International Finance Department. I started out full-time and since having my daughter I've been part-time-24 hrs./wk. I want to apply for an HR position at the university which is in a different division under the VP and General Counsel. Can I get out of the fee? My engagement letter states:

''... As such, the University, for itself and on behalf of its parents, subsidiaries and affiliates, agrees that it will not hire or contract for services, either directly or through a third party with any individual provided hereunder prior to the later of (i) a period of one year from the date hereof, or (ii) six months after the completion of such individual's project, without notifying Resources. In the event that the University or any parent subsidiary or affiliate, does hire or contract with, either directly or through a third party , any such individual in any capacity within the period referenced above, the University agrees to pay a replacement fee of 30% of such individual's annualized salary or contracted fee....''


Asked on 9/25/07, 2:00 pm

1 Answer from Attorneys
Roger Traversa Arjont Group (Law Office of Roger Traversa)

Re: Consulting Firm Replacement Fee

You asked about getting out of a finder's fee in an employment contract.

This clause is pretty common and on this limited review is probably enforceable against the university if the job would entail any of the same characteristics. Yes, even given the different divisions.

The good news is that if the employer wants you they are more than likely to either negotiate down or pay the fee to the consulting firm. THe consulting firm wants to maintain the employter's business and this probably does not smack of the one company poaching from the other.

Best bet is to talk it out with the employers. See if you have a shot at the new job and only then discuss it with the current employer. Make certain that you understand that once they are aware of the situation you will be persona non grata and will probably need to find another job.

Hope that helps.

Regards,

Roger

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Answered on 9/25/07, 4:21 pm


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