The late Jim Camp, author of Start With No (subtitled “America’s Number One Negotiating Coach Explains Why Win-Win Is An Ineffective, Often Disastrous Strategy, And How You Can Beat It.”), one of my favorite books on negotiation, insists that every good negotiation must begin with a statement of “Mission and Purpose”.
Moreover, you have to design that statement of “Mission and Purpose” from the point of view of the party sitting on the other side of the table. According to Camp’s system, you ultimately serve your own client by understanding the other party’s needs.
It sounds paradoxical, but on reflection makes perfect sense. Why would you spend valuable time and energy not dedicated to providing some product or service which will assist someone in a meaningful way? Camp further insists that this is the only way in which fair and lasting deals – deals in which neither party is taken advantage of – are made.
As executive employment attorneys working primarily in higher and secondary education, our own general “Mission and Purpose” statement could be written as follows:
“To help College and University President and Head of School clients achieve contracts in which their hard work, diligence and dedication are adequately compensated and by which they are sufficiently protected from the numerous dangers in today’s contentious educational world. The ways in which we do this are by understanding the market and helping the schools recognize and calibrate our executive clients’ individual needs and unique worth.”
Every one of our individual clients has a personal situation and individual desires which must be coordinated with the realities of academic life. Additionally, although some of the issues which our clients and their educational institutions face are found in executive employment situations generally, others are peculiar to academic life.
Here are just a few of the issues which we customarily have to address:
1. The Structure of Compensation.
Put simply, some of our clients want more of their total compensation paid “up front” during their working years. Other clients are more interested in having a greater amount of their compensation deferred, usually with some tax benefit, into retirement or other later life funds. This is a highly personal calculation, and of course has to be balanced against the resources of the particular University, College or School in the overall compensation structure (e.g., certain types of deferred compensation, payable at the end of the contract term, act as an incentive for the President to remain at his or her post for the entire length of the employment contract).
2. Indemnities.
With the increasing possibility of being included as a named party in lawsuits against the College, University or School regardless of legal merit, a President or Head of School must be fully indemnified by the School against personal liability for both damages and legal fees. The full scope of these indemnities often involve the School’s foundational documents, separate Board resolutions and state and/or Federal law. They must be written in a sufficiently broad way so as to protect the President or Head in the fulfillment of his or her employment responsibilities. The School must also include the President or Head as a named insured in one or more liability policies.
These indemnities were once more or less pro forma because they were rarely needed. Today’s vitriolic educational climate makes it more likely that they will be called on, since third-party lawsuits including the CEO as a point of leverage have become more prominent.
3. Tenure and Retreat Rights.
Some Colleges and Universities do not have tenured faculty, and some are trying to reduce or eliminate academic tenure. However, in those still frequent situations where the prospective President is already a tenured faculty member at school X, and his or her prospective appointment is at a school Y, it is important to protect the President’s tenured status and his or her ability to “retreat” to the school’s faculty (customarily at the highest current faculty salary) in the event that the President wishes to resign the presidential position or the presidential term comes to an end.
Whether or not the former President actually does go back to the faculty is uncertain (they usually do not), but it is an important protection to preserve the individual’s hard-won tenure rights despite their current executive status.
These three issues are only some of the legal, business and practical considerations which we must deal with in carrying out our own “Mission and Purpose” on behalf of our academic executive clients.
Lisa and Theresa join me in wishing you and your families a pleasant and restful end of summer.
