Contract Negotiation for Mid-Career Game Developers (Part 1)

by Darius Kazemi on April 15, 2011

in contract negotiation


More than five years ago I wrote the first article in my Effective Networking series. I wrote it because I was just breaking in to the game industry, and I looked at my peers (students) and saw that there was a huge hole in their knowledge when it came to networking skills. These days I’m a relatively experienced working game developer. And I’ve lately noticed another conspicuous gap in knowledge: almost none of my peers seem to understand contract negotiation, specifically as it pertains to employment contracts.

This is a huge shame, as it causes many devs to get themselves into frustrating, confusing, and stressful situations down the road that could be avoided well ahead of time. I hope that this series of articles helps at least a few developers avoid these situations.

DISCLAIMER: I am not a lawyer. The stuff I’m going to talk about is not to be construed as specific legal advice. I’m mostly sticking to the general principles of contract negotiation, and what to look out for in an employment contract. What I say here applies specifically to the United States, as I know nothing about the law or contract negotiation etiquette in other countries. What I say here may screw you over. This advice is for mid-career game developers: if it’s your first job out of school, I dunno, maybe you should just sign what you’re given to get that foot in the door! (But maybe not.) And finally: if you have any specific questions about the legality of something, CONSULT A LAWYER.

The most important thing

The first thing that you have to understand about employment contracts is this: employment contracts are negotiable. So many developers don’t understand this simple fact! They think an employment contract is a sign / don’t sign type of deal.

It’s sort of understandable. Let’s say you’re looking for work: over the course of weeks or months, you submit your resume, do the phone screen, go in for the in-person interview, maybe do some salary negotiation, get the offer letter, and then get an employment contract. You might think it would be ungrateful to negotiate at this point, since they clearly like you and want you to work there. But that idea is flat-out wrong. (I’ll go into more detail as to why in a later article.)

At this point, hopefully, you’ll read your contract. (Some will sign it without reading it. These people are known as idiots.) Maybe you come across a clause that says the company owns all your “inventions.” Maybe you see something that says you can’t work in games for a year after you work for them. Maybe you don’t understand a damn thing because it’s all a bunch of jargon!

After reading the contract, many people assume that they have one decision to make: sign the contract if they like it, or turn down the job if they don’t like the contract. Thing is: the contract you are given does not have to be the contract you end up signing. A contract is simply a legally binding agreement between two parties. The key word here is agreement. The whole process of negotiation is the process of coming to an agreement between you and your prospective employer.

What to expect from the rest of this series

Topics I’m going to cover in this series include:

  • Why you should never be afraid to negotiate
    • The worst that can happen isn’t so bad
  • Why you should never take someone at their word (“trust us, we’d never enforce that”)
    • Plus a surefire way to get past that without making it seem like you don’t trust them
  • What to look out for in a contract, and reasonable modifications you can suggest
    • IP assignment
    • Non-compete
  • The specific mechanics of contract negotiation
    • What kind of stuff do you write in your email when you hand back a modified employment contract?
    • HOW do you modify the contract, mechanically speaking: what software do you use, if any?
    • How do you convey what was modified in such a way that you kind of look like you know what you’re doing?
    • How do you approach the situation with tact?
    • How much back and forth should you expect?
  • With a contract, the only limit is your imagination! (i.e., other random crap you can try adding to your contract)

(Special thanks to Kent Quirk for providing a lot of valuable feedback.)


Ian Schreiber April 15, 2011 at 8:42 am

One thing I’d add that you didn’t mention: sometimes you don’t even see the employment contract until your first day on the job, where you sign that as part of all the paperwork (along with 401k and health benefits elections). If you’ve moved across the country to take this job and you’ve already “started” that makes it all the more intimidating to be negotiating now – it would appear at this point the company has you over a barrel, because you’re hardly going to be walking away after such a huge sunk cost! Also, by putting the employment contract in with a bunch of other routine forms, this tactic does tend to make the process feel more like busywork than an actually important piece of paper to scrutinize… especially when you’re anxious to stop filling out forms and get out there to start working on the next cool project.

Darius Kazemi April 15, 2011 at 9:01 am

That’s a good point. The short answer is: demand to see your employment contract well before your first day on the job, and before you make any life changes you can’t take back.

adam May 29, 2011 at 8:55 am

In the UK (probably EU too), you’re already legally protected in that case.

Basically: the employer loses-out, because they were too stupid/lazy to sort this out – you end up with an “industry standard” contract which is vague in many ways. Since employment contracts usually spend 99% of their words protecting the employer…

Shy Developer April 17, 2011 at 10:58 am

Very much looking forward to reading more on this subject. Any advice for someone that’s been working for a game dev company for a while who *doesn’t* have a signed contract?

Darius Kazemi April 17, 2011 at 1:05 pm

I might include something like that. Generally speaking, you should ask management for a contract if you don’t have one. It may be very much worth talking to a lawyer: depending on the state you live in, working without a contract may be illegal, or it may require your employer to do a bunch of things they don’t want to do. In that case you can be like, “I don’t want you guys to get in trouble, so I should have a contract.” But I don’t know for sure.

Ian Schreiber April 17, 2011 at 1:35 pm

No contract? Sweet! Talk to a lawyer and figure out just how much you can weasel out of your employer. Take the source code just before launch day and sell it yourself under your own banner. Sell corporate secrets to the competitors. The sky’s the limit! Um… ahem… by this I mean “yeah, what Darius said, ask nicely for a contract.”

Shy Developer April 17, 2011 at 4:58 pm

It’s actually not that bad. They made a lackadaisical attempt at a contract about 5 months in, but have never asked for me to sign it. I’m just trying to figure out what it means if I decide to leave, what kind of negotiable power I may have at this standpoint, and so on.

Ian Schreiber April 17, 2011 at 5:57 pm

Best bet is to ask a lawyer. I’m not a lawyer, but my understanding is that without a contract, neither you nor your employer owe the other one anything, no way no how. This is obviously not a good position to be in (consider what happens if they suddenly stop paying you, for instance, or if a verbal promise is made to you about some kind of bonus or royalties on a product and then the company doesn’t follow through) but it’s not good for your employer either (what happens if you give your resignation notice, promise to finish up a few things before you leave, and then don’t follow through).

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