Written Agreements Supercede Others - 29 Mar 2011

Written, unambiguous agreements between
employers and employees are generally enforced based upon their specific
terms, irrespective of whether the employer or employee claim they
orally agreed to something other than what is in the written agreement.

This issue was addressed by the United
States Court of Appeals for the First Circuit, which hears appeals from
both New Hampshire and Massachusetts, in the Feb. 18, 2011 case of
Anthony Artuso v. Vertex Pharmaceuticals, Inc.

Vertex is based out of Massachusetts and
recruited Artuso, a high-level executive from a rival, offering him
restrictive stock shares, stock options, and a bonus, in addition to his
regular compensation. The written agreement specified that Artuso would
serve as an at-will employee with the title of vice president for
strategic planning. The agreement had an integration clause, which
expressly stated that it would constitute the complete agreement between
Artuso and Vertex regarding employment matters and would supersede all
prior written or oral agreements or understandings.

Some time later, Vertex terminated
Artuso’s employment, asserting that it was part of reorganization. As a
result, Artuso was not able to exercise certain stock options, which
could only be exercised during continued employment, and he did not
receive a bonus for the year he was terminated. The stock agreement
referenced a separate document that detailed the stock and option plan,
which also contained a continued employment clause that stated that you
had to be employed in order to exercise the stock options.

Even though the stock and option plan was
not part of the written agreement, the court found that incorporation by
reference is a common tool in drafting contracts and that employing
that technique does not in and of itself create any ambiguity in the
contract.

In other words, as long as the employee had access to a certain plan referenced in an agreement, the employer would be well

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