In British Columbia, employers frequently revise employment agreements to reflect evolving roles and responsibilities, or compensation structures. However, one critical legal principle often overlooked in this process is the requirement for fresh consideration. Without it, employers risk having their updated agreements declared unenforceable, a mistake that can be costly in employment litigation.
What Is “Consideration”?
At its core, “consideration” refers to something of value exchanged between parties entering into a contract. In the employment context, this usually means offering the employee something new, such as a promotion, raise, signing bonus, or new benefits, in exchange for their agreement to new or updated contract terms. “Fresh consideration” is simply a further exchange of value if you intend to change a pre-existing contractual relationship.
Fresh consideration becomes particularly important when:
- An employee signs a contract after having already started work; or
- An employer attempts to change an existing employment agreement.
Without fresh … Continue reading