An employment contract may state the amount of liquidated damages to be paid if the contract is breached. Upon a party's breach, the other party will recover this amount of damages whether actual damages are more or less than the liquidated amount.
If the agreed-upon liquidated damage amount is unreasonable, the Court will hold the liquidated damage clause to be void as a penalty. If the Court declares the clause to be void, the employee would have to prove the actual damages.
Alaska Liquidated Damage Clause in Employment Contract Addressing Breach by Employer In Alaska, the liquidated damage clause in an employment contract is a provision that addresses potential breaches by the employer. This clause sets forth a predetermined amount of damages that the employer agrees to pay the employee in the event of a breach. One type of liquidated damage clause in Alaska is the specific performance liquidated damages. This type of clause typically requires the employer to provide specific performance of the contract rather than paying a monetary sum. If the employer fails to perform as required in the contract, the employee may seek an order from the court compelling the employer to fulfill their obligations. Another type of liquidated damage clause in Alaska is the monetary liquidated damages. This type of clause establishes a fixed amount of damages payable by the employer to the employee in case of a breach. The predetermined amount is agreed upon by both parties and is meant to compensate the employee for any harm or losses incurred due to the breach. Furthermore, some employment contracts in Alaska may include a sliding scale liquidated damage clause. This provision calculates the damages based on a sliding scale, meaning that the amount of damages paid by the employer increases as the severity or impact of the breach becomes greater. This type of clause aims to establish an equitable measure of compensation relative to the extent of harm caused by the breach. It is important to note that Alaska law places certain restrictions on the enforceability of liquidated damage clauses in employment contracts. For such a clause to be valid, it must be determined by the court to be a reasonable estimate of the actual damages that could be incurred by the employee in case of a breach. If the liquidated damages are deemed excessive or punitive in nature, the court may declare them unenforceable and instead award actual damages. Overall, a liquidated damage clause in an employment contract is a valuable mechanism for addressing breaches by an employer in Alaska. It provides protection for the employee by ensuring a pre-determined measure of compensation for potential harm caused by the breach. Employers should be cautious in drafting such clauses to ensure reasonableness and compliance with Alaska employment laws.
