Read Your Offer Letter Like a Lawyer (Most People Don't)
The 4-page offer letter has 9 clauses that matter and 30 that don't. Confusing the two costs people thousands when they leave, get acquired, or compete with the company later.
Most people read an offer letter twice. Once for the salary. Once for the title. They sign and forget. The other 4 pages sit in a drawer until something goes wrong — and by “something goes wrong” I mean they want to leave, the company gets acquired, or a recruiter from a competitor reaches out.
There are 9 clauses you need to read carefully. The rest is boilerplate. Here are the 9, what they mean, and what to push back on.
1. At-will employment
Standard in 49 US states. Means either side can terminate without notice, for any reason that isn’t illegal. Don’t try to negotiate this away — it’s not going to happen at most companies. But know that “you are an at-will employee” is the floor of your protections, not the ceiling.
2. Severance terms
The default is “no severance unless layoff, then per policy.” Push for: “minimum N weeks of severance regardless of cause, except for cause defined as [narrow list].” Senior ICs and managers can usually get 8-12 weeks negotiated up front.
The phrase “for cause” matters. If “cause” is broad (“violation of company policy”), they can fire you for almost anything and skip severance. Push for “willful misconduct, conviction of a felony, or material breach of duties.”
3. Equity vesting + acceleration
The standard is 4 years with a 1-year cliff. The thing to negotiate is single or double trigger acceleration on change of control.
- Single trigger: company gets acquired → all your equity vests immediately.
- Double trigger: company gets acquired AND you’re terminated within 12 months → all your equity vests.
Single trigger is rare for ICs. Double trigger is increasingly standard for mid-level and up. Ask. If they refuse, ask why. Their answer tells you about the planned exit.
4. IP assignment
The default is “everything you create, on or off the clock, related to the company’s business, belongs to the company.” This is broad enough to cover side projects in your free time.
In California (Labor Code 2870), the law limits what they can claim — they can’t take work you do on your own time, with your own equipment, that’s unrelated to the company’s business. Other states are weaker.
Push for: a Schedule A listing your existing inventions and any side projects you want carved out. They almost always accept the list. If you don’t list them, they’re presumed to be company property.
5. Non-compete
Federal Trade Commission tried to ban these in 2024 — the rule is being litigated. As of 2026, enforceability varies by state.
Ask the recruiter: “Is there a non-compete in this offer?” If yes, ask for a copy. Read the geographic and time limits. A 2-year, 50-mile non-compete in a state that enforces it can lock you out of your industry.
In California, Massachusetts (with conditions), and several other states, non-competes for employees below a salary threshold are unenforceable. Doesn’t mean they won’t put it in. Means they probably can’t enforce it.
6. Non-solicit (clients + employees)
Usually 12-24 months after termination. Stronger than non-compete in most jurisdictions. Means you can’t poach customers or coworkers when you leave.
This is where founders get burned. If you’re joining a startup and 6 of your 8 best engineers are coworkers, plan for the day you leave. Document who you recruited before this job and who you’ve worked with before — that becomes your “I knew them already” defense.
7. Mandatory arbitration
Buried in the boilerplate. Means employment disputes go to private arbitration, not court. The arbitrator is paid by the company. The discovery is limited. The decision is mostly unappealable.
Some companies will carve out exceptions for sexual harassment claims (post- Ending Forced Arbitration of Sexual Assault Act, 2022). Read the clause. If you’re uncomfortable, ask for the carveout to be expanded.
8. Confidentiality + survival
Confidentiality clauses survive employment. Standard. But check the length and the scope.
- “Trade secrets indefinitely, confidential information for 5 years” → reasonable.
- “All information indefinitely” → too broad. Push back.
Survival clause: which terms remain after you leave? Usually IP, confidentiality, non-solicit, sometimes non-compete. Make sure you understand which obligations follow you.
9. Compensation review timing
The phrase “annual review” is vague. Push for: “first salary review at 12 months, eligible for promotion review at 18 months.” Without this, the company can decide you’re “not on track” without giving you a structured process.
If equity refresh is a major part of your pay, ask: “When do equity refreshes happen and what’s the typical range?” “Discretionary” is code for “we don’t guarantee anything.”
The 30 things that don’t matter as much
Office address, dress code reference, vacation policy boilerplate, the “we’re excited to have you” language, the standard NDA reference, the parking policy, the badge return clause, the company directory consent. Skim. Sign.
The 1 thing nobody tells you
Ask for the employee handbook before you sign. The offer letter incorporates it by reference. The handbook is where the actual rules live — bonus eligibility, PIP process, leave policy, expense reimbursement. If they refuse to share it before you accept, that’s a signal.
This is general information. For specific contracts, hire an employment lawyer. The $500 review fee saves an order of magnitude more in mistakes.
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