12 clauses in an employment offer letter you should never sign as-is

Offer letters are negotiable. Most people don't ask.

Recruiters quote the salary, the bonus and the equity grant, and then send a 12-page offer letter with terms most candidates skim. The salary is the smallest variable in that document. The vesting schedule, the IP assignment, and the non-compete will affect your wealth more than any cost-of-living adjustment ever will.

Clause 1 — Vesting schedule and cliff

Standard U.S. tech vesting is 4 years with a 1-year cliff (nothing vests until month 12, then 25% vests, then monthly thereafter). Negotiable items: shorter cliff (6 months), faster initial vest (33% at month 12), or back-loaded vest if you're a senior hire.

Clause 2 — Single vs. double trigger acceleration

If the company is acquired, what happens to your unvested stock? Single trigger: it accelerates on the acquisition itself. Double trigger: it accelerates only if you're also terminated without cause within X months of the acquisition. Double trigger is the market norm; single trigger is rare but worth asking for at senior levels.

Clause 3 — Post-termination exercise window (PTEW)

If you leave the company, how long do you have to exercise your vested options? The legal minimum is 90 days. Many late-stage startups now offer 7-10 years (you exercise when you can afford to, or when the company exits). This single clause can mean the difference between exercising and losing your stock.

Clause 4 — Repurchase rights

Some offer letters give the company the right to repurchase your vested stock at cost — or even at "fair market value" determined by the company — if you leave. This makes "vested" meaningless. Strike or limit to repurchase at FMV determined by an independent appraiser.

Clause 5 — Non-compete

U.S. non-competes are increasingly unenforceable (the FTC's 2024 non-compete rule, although blocked by courts in some districts, signals the regulatory direction). In California they've been unenforceable since 1872. In India they're limited to the term of employment under Section 27 of the Indian Contract Act. Read your jurisdiction; negotiate accordingly.

Clause 6 — Non-solicit of employees and customers

More enforceable than non-competes and almost always present. Watch for: duration (12 months is standard, 24+ is aggressive), scope (limited to employees you supervised, or every employee?), and whether "solicit" includes responding to inbound interest.

Clause 7 — IP assignment

Most offer letters assign all IP created "in the course of employment" or "using company resources". A few overreach to "any IP created during the term of employment." That second version captures your personal blog, your side projects, your weekend novel — even if unrelated to the company's business. Strike or limit.

Clause 8 — Prior inventions schedule

Almost every U.S. offer letter has a "Schedule A: Prior Inventions" where you list IP you developed before joining. Fill it in. If you don't list a side project, the company can later claim it. The schedule is your only protection.

Clause 9 — At-will employment vs. notice period

U.S. employment is usually "at-will" — both sides can terminate with no notice. UK, EU, and India have statutory notice periods (typically 1–3 months). On a senior role, negotiate a notice period or severance even in at-will jurisdictions.

Clause 10 — Severance and CIC

Standard executive severance: 6–12 months of base salary plus pro-rated bonus, paid out over 6–12 months, in exchange for a release of claims. Change-in-control severance is typically 2× that. Ask for it in writing; verbal promises don't survive a CEO change.

Clause 11 — Arbitration and class-action waivers

Most modern U.S. offer letters require mandatory arbitration for all employment disputes and waive your right to participate in a class action. These are enforceable in most jurisdictions. You usually can't strike them, but you can sometimes negotiate to have the employer pay all arbitration costs.

Clause 12 — Governing law and forum

If you're hired by a Delaware company and based in Bangalore, what law governs your offer? Usually whichever is more favourable to the employer. Push for the law of your work location, or at least carve out statutory employee protections in your jurisdiction.

The one-paragraph negotiation

After 48 hours of review, reply with a single paragraph: "I'd like to discuss four items before signing: (1) PTEW extended to 7 years, (2) double-trigger acceleration on the full grant, (3) non-solicit reduced to 12 months and limited to employees I directly supervised, (4) governing law of [your location]. Everything else looks great." That ranking, with rationales held in reserve, gets the best result.