Today's Daily Tip
The Yoga Teacher's Employment Contract, Part 2
Breach of Contract
The remedy for breach of contract typically consists of money damages, in an amount intended to restore the injured party to the economic position that he or she expected from performance of the promise or promises (this is known as an "expectation measure" of damages). Because courts generally deem expectation damages sufficient, are reluctant to force people back into employment situations, they rarely order the parties to fulfill the contractual promises (a remedy known a "specific performance").
So, for example, if the studio contracts to hire a yoga teacher to teach 15 classes a week, at $40 per class, over 50 weeks, and after one month (during which the studio has paid the teacher), terminates the teacher in a way that breaches the contract, the damages will likely be 15 classes x $40 x the remaining 26 weeks, or $37,600. The law typically does not allow punitive damages—monetary recovery many times the actual amount of loss, intended to "punish" the defendant—unless there is proof of actual fraud, meaning an initial intent to deceive.
Some yoga teachers might wonder, why think about breach of contract before I even sign it—why contemplate the end of a legal relationship when it is just beginning? Understanding the remedies for breach up-front can help shed light on what will happen if the situation ultimately does not work out—thus helping one prepare contingencies and protect oneself financially in case of later trouble. Further, for many professionals, to know in advance and mentally prepare for the worst-case scenario can help not only structure the deal at the outset, but also reduce anxiety once the contract is signed, and thus contribute to a constructive professional relationship overall.
Understanding remedies can also help if, in the midst of things, a dispute arises. If, for some reason, after a period of time, either side starts thinking of walking away from the contract, it may be useful to try to stave off a lawsuit by settling. Understanding the measure of damages—what the case would be worth if the plaintiff wins—can help the yoga studio or teacher negotiate a wise settlement. And, bearing Patanjli's wisdom in mind, the best settlement is a fair one: an arrangement that does justice to all sides, and thus lets both walk away without enduring rancor.