The Yoga Teacher’s Employment Contract, Part 1

Should yoga teachers have employment contracts? If so, what constitutes a legally binding contract? What’s the best way to avoid mistakes and misunderstanding?

By Michael H. Cohen, J.D., M.B.A.

Should legally binding contracts have any place in a yoga studio? Some yoga teachers may object to signing contracts because they feel the relationship between the studio (or gym, or other institution) and yoga teacher, like the relationship between yoga teacher and student, is sacred and beyond reproach. Such relationships ought to be healthy, and sufficiently full of trust that legal agreements are unnecessary.

This argument has appeal, but it is important to remember that legal rules and contracts already cover a host of relationships within the yoga studio. Apart from dealing with teachers, studio owners have all sorts of legal obligations whose violation—whether intentional or otherwise—could lead to a lawsuit. These can include a lease on the studio or mortgage on the building, insurance policies, business partnerships, and more.

Given the yoga studio's existing participation in a variety of legally binding agreements, contracting for services with yoga teachers is a logical extension of the notion that contracts are a necessary part of the business of yoga. A contract clarifies legal rights and duties—within the business context, what each side has the right to demand and expect of the other. Further, since professional relationships can change over time, concretizing rights and obligations in writing can help establish the rules and boundaries between the parties, rather than leaving these up to the vagaries of how well people get along over time.

Before going into the specifics of items that a yoga teacher's contract should or should not include, let's look at the legal impact such contracts can have on the relationship between the studio and the teacher.

LEGALLY BINDING CONTRACTS
In negotiating contracts, it is important for both yoga teacher and studio to know when the exchange about hiring the teacher is just a conversation, and when it becomes legally binding. What makes an agreement legally binding? By law, a contract has three elements: offer, acceptance, and consideration—a legal term that means both sides must get something in exchange for what they give. An offer alone does not create a legally binding agreement; the offer must be accepted, and the deal must be supported by consideration.

Let's look at each of these. An offer is a statement that manifests an intention to enter into a legally binding agreement. Neither an invitation to make an offer ("I'm going to make an offer to hire you as a yoga teacher in my studio") nor a statement of a willingness to make an offer ("I'm interested in hiring you to teach") constitutes a legally sufficient offer.

Next, the acceptance: an indication that the offer is absolutely accepted. "That sounds like a good deal" is not acceptance. The acceptance must be clear, unequivocal, unconditional, and made by the person to whom the offer is intended. The acceptance must also be made before the offer expires. A counteroffer ("I'd like to teach in your studio, but I need at least $10 a student") is not an acceptance—rather, it is a new offer than can be accepted (or not). On the other hand, clear statements such as "We have a deal" or "I accept" do constitute acceptance.

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