The U.S. District Court for the District of Delaware reviewed a contract dispute between a salaried sales manager and Multi-Color Corporation. In Christiansen v. Multi-Color Corporation, the plaintiff claimed that the company failed to pay his salary during a one-year restricted period. He argued that the compensation agreement required continued pay after termination if he met specific conditions.
The plaintiff earned a $200,000 annual base salary. According to the agreement, continued pay depended on signing a release and complying with a non-compete clause. The employer argued that the plaintiff did not satisfy those conditions and declined further payment.
In July 2024, the court ruled that the agreement did require continued salary under certain conditions. It partially upheld the breach of contract claim. However, it postponed a decision on damages until it could confirm whether the plaintiff followed the contract terms.
Lessons learned from the case:
- Define post-termination pay terms clearly in employment agreements.
- Employers should ensure that severance or salary continuation clauses are enforced consistently and not left to interpretation.
- Courts may uphold salary continuation linked to non-compete clauses—even after termination.
If you want to know more about salaried employee rights, read our guide on What are my rights as a salaried employee in Delaware?
