Ties That Bind

Proper Packaging

Any negotiation can create resentment if not presented in the proper fashion. That's why Kathleen Misturak-Gingrich, a partner in the Philadelphia law firm Manta and Welge, insists all parties in the agreement understand the contract is intended to protect everyone. "I encourage the parties to talk about what each wants and what concerns them, and to think through what they want to accomplish in the business," she says.

Some advisors encourage the family member and the company, whether represented by a management team or the senior generation, to put in writing the provisions most important to them. Even if the provisions are revised during the negotiation, at least the parties have had an opportunity to explain what they're after and be acknowledged and understood.

While it's wise to include a re-negotiation clause in the employment contract, the re-negotiation itself may never need to take place. "At some point, if the family member is productive and motivated and wins the respect and admiration of senior management, the formal employment contract might be put in a drawer and deemed irrelevant," says Wolfson.

Until that point, however, written contracts can head off or minimize the dissension and bickering that have wrecked many a family business.

Contact Sources

California Family Business Institute, (800) 952-CFBI, http://www.cfbi.com

Grand Warehouse Corp., 4350 W. Ohio, Chicago, IL 60624, (773) 265-0403

Kathleen Misturak-Gingrich, c/o Manta and Welge, 2000 Market St., 6th Fl., Philadelphia, PA 19103, (215) 851-6626

Jeffrey Wolfson, c/o Goulston & Storrs, 400 Atlantic Ave., Boston, MA 02110

« Previous 1 2 Page 3

Like this article? Get this issue right now on iPad, Nook or Kindle Fire.

This article was originally published in the April 1998 print edition of Entrepreneur with the headline: Ties That Bind.

Loading the player ...

How to Start a Business in 10 Days

Ads by Google

Share Your Thoughts

Most Shared Stories

1
15 Signs You're an Entrepreneur
2
Want Media Attention? Target Trades First
3
10 Things All Entrepreneurs Must Do Before Quitting Their Day Job
4
The One Habit That Can Make or Break Your Success
5
Is It That Important to Be Nice?