As I may have mentioned in passing a thousand or so times, I support our HR function. Yes, the under 22 set with their quirky habit of violating their own dress code, social media use, and tobacco and alcohol on company premises policies. You know, the rule breakers who make the rules.
Without bothering to give Legal a heads up, HR terminated a benefits provider in favor of a more economical partner. I wish I had the space (or the nerve) to provide the text of the email (no registered mail, mind you, even though the contract required it) that HR sent. But it went something like this:
Dear [_____________],
We are terminating your contract immediately for poor service. We wish you all the best with your future endeavors. Sincerely, an HR VP who continually parks in the expecting mothers’ spot despite being male.
Okay, fine. I made up the signature line (but it’s true, the man has no shame). And here’s a hot pro tip for you business types, at least put a name in the addressee field. Otherwise, someone might think your best wishes for future endeavors to be a tad insincere.
A full quarter after this brilliant electronic kiss off, HR received a bill for — you guessed it — a $25,000 cancellation fee and the monthly service fees for the remaining three months in that contract year. Within hours of receiving this, HR scheduled a 5:00 meeting, because who doesn’t love a 5:00 meeting on a Friday before a long weekend?
Luckily, HR showed their hand by scheduling a meeting, rather than their normal habit of just showing up at my office demanding I solve some problem that could have easily been avoided. Like this one. So, I had a full 40 minutes to dig through my carefully organized Outlook folder where I advised the team JUST LIKE THIS not to accept the cancellation fee in Section 12 or eat the remaining months in the contract year in Section 15. And before you ask, no the highlight is not overkill with this team.
Even though the cancellation fee wasn’t strictly a legal point, I’m a business lawyer, so when I see things that make no business sense (like an outrageous cancellation fee), I flag it. That, and I really like my long-suffering HR Procurement partner. I knew she’d be making the same points in her comments, so I thought I’d come out in support of her before she had to go at it alone.
I also highlighted the lack of a termination for convenience clause (which I know some attorneys consider extravagant) and took the time to provide an example of how this would play out in real life if we were, to say, decide to terminate the contract six months into a 36-month term. I was off by three months, the relationship lasted nine months.
At 5:10 (because why would you bother to be on time for a Friday afternoon meeting before a long weekend… did I mention it was the Friday before a long weekend?), HR swept into my office in a truly spectacular huff. There was so much huff. And indignation. And gnashing of teeth.
I listened with my “could you say a little more about that” face, all the while my inner child (who enjoys fart jokes and 90s Adam Sandler movies) stomped her foot and shouted, “I told you so. I told you so. I told you so.” And it was completely unsatisfying. Of course, I was right. What was worse was that I’d even taken the time to write out a clear, not-overly long email explaining why we should push on these issues. I even offered to get on the horn with the vendor and help negotiate it out. And nobody listened.
When HR wound down, I explained that in addition to no termination for convenience language, there was no termination for performance either. (Side bar: And not only did the described wrongs not rise to the level of breach, material or otherwise, there wasn’t a single email between our team and the vendor to let them know we were so unsatisfied with the vendor’s performance that they were in danger of being terminated. Nothing. It was like someone invented the poor service argument to get out of a contract in favor of using another vendor.)
After breaking the bad news that we wouldn’t be going to court over a $68,000 invoice and pounding the tastefully lit hardwood of the jurors’ box a la Dick Wolf, I told the team our options were limited. We could call the vendor as a united commercial, legal, and procurement front to try and negotiate it down (we did try this and I’m still smarting from the verbal beatdown the vendor’s attorney delivered). Or, we could let this one go, accept the learnings, and plan for the next one.
As you may imagine, this news wasn’t well-received. I spent my Sunday evening on a call reiterating the same news to senior HR leadership. Only this time, the HR VP (yes, the giant man baby who parks in the expecting mothers’ spot), demanded to know why I hadn’t caught this. With more patience than this twerp deserved for disrupting my Sunday evening, I let him know that in no uncertain terms that I had caught this and flagged it for his team. I forwarded him the emails where I’d advised against the cancellation fee and offered help to negotiate it out. Then I asked him what he thought I could have done differently to better partner with his team.
After muttering about the need for Legal to be more “proactive,” I was dismissed. I went to bed fuming over that word and woke up the next day with it still hanging around like bad morning breath. I ended up calling an attorney friend on my commute in to chew over what I could have done to be more proactive (okay fine, I called to vent, and it was glorious). She listened, making all the right commiserating noises, and then offered me this gem: “Sometimes, you have to let them fail. If you bail them out now, the next time it’s $268,000 and it blows up their budget for the quarter. This is the right kind of amount for a lesson.”
This was deeply unsatisfying, but she was right. I did nothing. I stopped wracking my brain for some brilliant “get out of jail free” card or fourth quarter hail Mary pass. I let them pay the invoice. I offered no apologies for it. And when the next HR monthly meeting came, I sent in a five-bullet email that went around with the agenda that highlighted contractual term trends to be wary of as a savvy HR partner. It wasn’t quite as satisfying as resolving the issue, but I’d like to think it was a little proactive.
Oh, and I called facilities from one of the general conference lines and dropped an anonymous dime on that VP parking in the expecting mothers’ spot. Because, I’d like to think that was more than a little proactive.
Kay Thrace (not her real name) is a harried in-house counsel at a well-known company that everyone loves to hate. When not scuffing dirt on the sacrosanct line between business and the law, Kay enjoys pub trivia domination and eradicating incorrect usage of the Oxford comma. You can contact her by email at KayThraceATL@gmail.com or follow her on Twitter @KayThrace.
I Told You So: Now What? The In-House Counsel Search And Salvage Mission curated from Above the Law
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