morality clause
Definition
A morality clause is a section in a contract that lets one party end the agreement or withhold payment if the other party does something that causes public embarrassment or damages their reputation. Companies often include these clauses when they hire celebrities, influencers, or public-facing employees to protect their brand from being associated with scandalous behavior.
Example
A sports drink company signs an endorsement deal with an athlete and includes a morality clause, so when that athlete gets arrested, the company can legally drop them without paying out the rest of the contract.
Watch Out
The language in these clauses can be vague, so make sure any morality clause you sign clearly defines what counts as unacceptable behavior so you are not left vulnerable to a subjective judgment call by the other party.
See which terms appear in your contract?
This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.