MediaTech Law

Here’s an interesting question (at least interesting to me): When does a response to an offer constitute a counteroffer?  And if it does constitute a counteroffer, so what?  Does that counteroffer make the agreement binding or is it simply a rejection of the original offer?  In other words, is the counteroffer simply an offer for an entirely new contract?

This comes up frequently in employment situations, where for example a company might offer a severance package to an employee, and the employee might respond by asking for more money or other different terms.  Obviously, if the employee outright rejects the employer’s offer, that’s an easy case where the offer is dead.  But often that’s not what happens.  Instead, what often happens is that the employer offers a month or so of severance compensation, and the employee responds by asking for health care coverage as well.  Or asks for a letter of reference, or a mutual agreement of non-disparagement.  Or, for another couple of months of pay.