An Employee's Employment Agreement Is Years Old: When Should You Update It?

An employee signs an agreement and starts their job. Fast forward a few years: they’re doing well, the business is growing and they have naturally started taking on more responsibility.

Their duties, pay and position in the company have changed, yet their employment agreement has stayed exactly the same.

So, is it time to update the old agreement?

An old employment agreement does not automatically become invalid simply because time has passed. However, if the written agreement says one thing while the employment relationship has evolved into something quite different, it can create uncertainty around duties, compensation, confidentiality, intellectual property and other important terms.

The real question is not how old the agreement is - it’s how much the employment relationship has changed since it was signed.

Does An Employment Agreement Expire Just Because It Is Old?

Usually, no.

If the employee is still working under substantially the same arrangement and there has been no material change, you may not need to replace the agreement simply because several years have passed.

Fixed-term arrangements are different. If an agreement was intended to operate only for a limited period and that period has ended, what happens next can depend on the wording of the agreement, the parties’ conduct and applicable state law.

For most older agreements, the more useful question is whether the document still reflects the employment relationship you actually have.

If you are unsure, reviewing the existing Employment Agreement can help identify whether anything needs changing.

When Should You Review An Employee's Employment Agreement?

There is no universal US rule requiring small businesses to replace employment agreements every few years.

However, significant changes are useful review points. A promotion, new compensation structure, interstate move, major change in responsibilities or business restructure should prompt you to check whether the agreement still makes sense.

This does not mean producing a new agreement every time an employee receives a pay raise or takes on another task. If nothing material has changed, the existing agreement may still do its job.

The Employee Has Been Promoted Or Their Role Has Changed

An employee who originally joined in a junior position might now manage staff, negotiate with customers, make important business decisions or hold substantially more responsibility.

At that point, reviewing the agreement is about more than changing their job title. Reporting lines, responsibilities, confidentiality obligations, intellectual property provisions and authority within the business may all need another look.

Their actual duties can also have employment law consequences.

Under the Fair Labor Standards Act, certain executive, administrative and professional employees may qualify for exemptions from federal minimum wage and overtime requirements if the relevant tests are met. However, changing someone’s title to “manager” does not make them exempt by itself. Their actual duties and compensation must satisfy the applicable requirements. The Department of Labor's guidance on FLSA exemptions explains the tests in more detail.

A promotion can therefore be a good opportunity to check both the agreement and how the employee is being treated in practice.

If the role has changed substantially, it may be worth getting legal advice before simply updating their title and salary in an old agreement.

Their Pay, Bonus Or Commission Structure Has Changed

Compensation arrangements often evolve as employees become more senior.

An employee who originally received a straightforward salary might now receive bonuses, commissions, equity incentives or other performance-based compensation. If the written documents no longer reflect what has been agreed, disputes can arise over how compensation is calculated, when it is earned or what happens when employment ends.

Not every pay change requires a new employment agreement, but businesses should check whether an amendment, separate compensation agreement or written notice is needed.

This can also depend on where the employee works. For example, California law requires contracts involving commissions for services rendered in the state to be in writing and to set out how commissions are calculated and paid. You can read the requirement in California Labor Code section 2751.

New York also has wage notice requirements. The New York Department of Labor's Notice of Pay Rate guidance explains the information employers need to provide.

Where commissions have become an important part of the role, a separate Employee Commission Agreement may also be appropriate.

They Now Work Remotely Or In Another State

Perhaps the employee originally worked from your New York office but now works permanently from California. Or maybe the business has gone remote and employees are now spread across several states.

This is more than just a change of address.

US employment requirements can differ considerably between states and local jurisdictions, including rules around minimum wages, overtime, paid leave and employee notices. The Department of Labor's state minimum wage guide shows how significantly wage requirements alone can vary.

A change in work location can also mean reviewing working hours, expense reimbursement, equipment, data security and other remote-working arrangements.

If an employee permanently relocates to another state, do not assume an agreement drafted for their previous location will cover everything required in the new one. This is a useful time to speak with a legal expert, as the laws where the employee actually works may affect the arrangement.

Sprintlaw has covered these issues in more detail in its guide to Remote Work Policies Across States.

The Employee Now Has Greater Access To IP Or Confidential Information

Roles often become more sensitive as employees progress through a business.

Someone who initially had limited access to company information might eventually work with customer databases, commercial strategies, software, designs, financial information or other valuable material.

That makes it worth checking whether the confidentiality and intellectual property provisions agreed when they first joined are still appropriate.

There is also a specific federal rule to keep in mind. Under the Defend Trade Secrets Act, employers must provide notice of certain whistleblower immunity protections in contracts or agreements with employees that govern trade secrets or confidential information. This requirement applies to agreements entered into or updated after May 11, 2016.

An employer that does not provide the required notice can lose access to exemplary damages and attorney fees under the DTSA in an action against that employee. The requirement is set out in 18 U.S.C. § 1833.

If you are updating an older agreement, confidentiality clauses should therefore be reviewed rather than simply copied across.

Depending on the employee’s role, it may also be worth considering an Employee Confidentiality Agreement or Confidential Information and Invention Assignment Agreement.

What About Non-Compete And Other Post-Employment Restrictions?

If an older agreement contains a non-compete, non-solicitation clause or another post-employment restriction, it is worth reviewing those terms rather than assuming wording drafted years ago will still be enforceable.

Non-compete law in the US is particularly state-specific.

The FTC introduced a nationwide Noncompete Rule in 2024, but that rule was struck down in federal court and removed from the Code of Federal Regulations in February 2026. The FTC's current noncompete resources provide updates on the federal position.

That does not mean every non-compete is enforceable. Individual states may prohibit or significantly restrict these clauses.

If you are adding or expanding post-employment restrictions, getting state-specific legal advice before presenting the new terms to the employee is important.

Your Business Has Changed

Sometimes the employee has not changed very much - but the business has.

A company may have grown significantly, introduced new products, changed its management structure or changed the way staff deal with customers and company information.

Growth can also change which employment laws apply.

For example, the Equal Employment Opportunity Commission explains that many federal anti-discrimination laws generally apply to private employers with at least 15 employees, while federal age discrimination protections generally apply from 20 employees. The EEOC's Small Business Requirements guide provides an overview.

The Family and Medical Leave Act can also become relevant as the workforce grows. Private-sector employers are generally covered once they employ 50 or more employees for at least 20 workweeks in the current or previous calendar year, although separate employee eligibility requirements apply. The Department of Labor's FMLA guidance explains the rules in more detail.

Crossing these thresholds does not automatically mean every employment agreement needs rewriting. It may, however, mean your wider employment policies and documentation need attention.

If the employing entity changes following a restructure or transaction, you should also check whether existing agreements need to be amended, assigned or replaced.

As teams grow, this is a useful time to review your Employee Handbook and other internal policies.

Employment Laws Have Changed Since The Agreement Was Signed

The employee’s role may have stayed the same, but the laws applying to your workplace may not have.

Federal, state and local employment requirements can change over time, meaning an agreement written several years ago may contain outdated wording or fail to account for newer requirements.

However, a change in law does not automatically mean the agreement itself needs replacing. Sometimes the document requiring attention will instead be an employee handbook, workplace policy, employee notice or another part of the business’s employment processes.

If your business has employees across several states, has grown substantially or has not reviewed its employment documents for several years, speaking with a legal expert can help identify what actually needs updating.

Do You Need To Update The Agreement Every Time Something Changes?

No.

Taking responsibility for a new project, receiving an ordinary pay raise or making small adjustments to daily duties will not necessarily justify rewriting an employment agreement.

The changes that warrant closer review are generally those that materially alter the relationship - such as a significant promotion, new compensation structure, interstate move, substantial new responsibilities, change to working arrangements or a change in the employing entity.

Think of these events as review points.

You may decide the existing agreement still works. The important thing is making that decision intentionally rather than discovering during a dispute that the paperwork no longer reflects the relationship in practice.

Should You Amend The Existing Agreement Or Replace It?

Updating an employment arrangement does not always mean giving the employee a completely new agreement.

If only one or two specific terms have changed, an amendment may be enough. If the employee’s role, compensation, working arrangements and responsibilities have all changed significantly, preparing a new agreement may be clearer.

There is an extra consideration where you want to introduce significant new obligations after employment has already begun. Requirements for modifying an existing employment contract can differ between states, particularly where the employer is adding post-employment restrictions or materially changing contractual rights.

Rather than simply sending an employee a new document and assuming the previous agreement has disappeared, check how the old and new terms interact and whether state-specific requirements apply.

This is another point where legal advice can be useful. A legal expert can help determine whether an amendment, replacement agreement or another supporting document is the better approach.

What Other Employment Documents Should You Review?

Your employment agreement is only one part of the relationship.

As your business grows, it is also worth checking whether your employee handbook, remote work policies, confidentiality arrangements, intellectual property documents and other workplace policies still match how the business operates.

These documents do not all perform the same function. Businesses should be clear about which terms form part of the employee’s contractual arrangement and which documents operate as workplace policies that may be updated from time to time.

Sprintlaw’s Employment Law services cover employment agreements, employee handbooks, confidentiality arrangements and other employment documents that may need attention as a team grows.

Key Takeaways

An employment agreement does not need to be replaced simply because it is old.

However, an agreement signed when an employee first joined the business may no longer be appropriate after several years of promotions, compensation changes, remote working arrangements or increased responsibility.

Reviewing employment documents when material changes happen can help make sure the written arrangement still reflects the relationship you actually have.

If an employee has been promoted, moved states, changed compensation arrangements or taken on materially different responsibilities, speaking with a legal expert can help you work out whether the existing agreement still works or whether an amendment, new agreement or another employment document is the better option.

Sprintlaw can help small businesses review and update their Employment Agreements and related employment documents as their teams and working arrangements change.

If you would like a consultation on updating your employment contracts, you can reach us at (888) 449-8437 or team@sprintlaw.com for a free, no-obligations chat.