EX-10.38








Exhibit 10.38




AMENDMENT NO. 2 TO




AMENDED AND RESTATED EMPLOYMENT AGREEMENT




THIS AMENDMENT NO. 2 to the Amended and Restated Employment Agreement (the “Amendment”) is
made effective and entered into as of December 4, 2004 (the “Effective Date”) by and between
RemedyTemp, Inc., a California corporation (“Remedy” or the “Company”), and Robert Emmett
McDonough, Sr. (“McDonough”), with reference to the following facts:



A. Remedy and McDonough are parties to that certain Amended and Restated Employment Agreement,
dated January 7, 1998 (the “Original Employment Agreement”), as amended by that certain Amendment
No. 1 to Amended and Restated Employment Agreement, entered into as of January 18, 2001 (together
with the Original Employment Agreement, the “Employment Agreement”).



B. To incorporate contractual modifications agreed to by the Board of Directors of Remedy (the
“Board”), Remedy and McDonough now mutually desire to amend certain provisions of the Employment
Agreement.



NOW, THEREFORE, in consideration of the mutual covenants contained herein, and such other good
and valuable consideration, the parties hereto agree as follows:



Except as hereinafter provided, capitalized terms used herein shall have the meanings ascribed
to such terms in the Employment Agreement.



1. AMENDMENTS TO THE EMPLOYMENT AGREEMENT.




The following portions of the Employment Agreement are amended as follows:




	 	1.1.	 	The entire Section 1 of the Employment Agreement entitled “EMPLOYMENT
SERVICES AND DUTIES” is hereby deleted and the following is substituted in its place:






“1. EMPLOYMENT SERVICES AND DUTIES



Effective December 4, 2004, the Company agrees to employ and retain the services of McDonough
as Vice Chairman of the Board of Directors of Remedy (the “Board”), and McDonough hereby agrees to
continue employment with the Company as its Vice Chairman, for the term of this Agreement. While
employed as Vice Chairman of the Board, McDonough shall be an officer of Remedy and shall be
entitled, subject to the provisions of this Agreement, to all rights and privileges attendant to
such position with the Company. McDonough agrees to perform his duties as Vice Chairman of the
Board faithfully, to the best of his ability and in the best interests of the Company, and to
preserve and protect the confidential information of the Company, and to perform his duties as
directed by Remedy’s Chief Executive Officer and the Board.”




	 	1.2	 	The entire Section 2 of the Employment Agreement entitled “TERM OF
EMPLOYMENT” is hereby deleted and the following is substituted in its place:






“2. TERM OF EMPLOYMENT



The Company agrees to employ McDonough, and McDonough agrees to serve, as Vice Chairman for
the period commencing December 4, 2004 and ending on December 3, 2007 (the “Employment Period”).
In the event of McDonough’s death during the term of this Agreement, this Agreement shall
immediately terminate and the Company shall have no further obligation to McDonough’s surviving
spouse, estate or legal representatives, except for payment of McDonough’s accrued but unpaid
salary and vacation at the time of such termination.”




	 	1.3	 	The entire Section 3 of the Employment Agreement entitled “COMPENSATION
TERMS” is hereby deleted and the following is substituted in its place:






“3. COMPENSATION TERMS



The Company agrees to compensate McDonough for his services rendered as Vice Chairman under
this Agreement as follows:



(a) Commencing on December 4, 2004, McDonough shall receive an annual base salary of $100,000.
McDonough shall not be entitled to receive any bonus during the Employment Period unless the
Compensation Committee, in its sole discretion, determines to award McDonough a bonus.



(b) McDonough shall be entitled to and shall receive any and all other benefits generally
available to executive employees of the Company, including participation in health insurance
programs and retirement plans and reasonable expenses.



(c) During the Employment Period, McDonough shall be entitled to maintain his current office
space at the Company; provided that, as determined by the Board in its reasonable discretion,
McDonough reasonably complies with all applicable workplace regulations, standards and laws.
Additionally, alternative office space at the Company shall be provided to McDonough in the event
that the executive office area is physically reconfigured. Furthermore, during the Employment
Period, McDonough shall receive office perquisites and amenities generally available to the
officers of the Company, including part-time secretarial services.



(d) The Company shall pay any and all premiums that become due and payable on or before
December 4, 2004 on any of McDonough’s six existing life insurance policies. After December 4,
2004, including in the event that McDonough is no longer Vice Chairman or employed by the Company
in any other capacity, the Company shall continue to pay such life insurance premiums as required
under each and every life insurance policy, provided that the total aggregate amount of premiums
paid for such life insurance policies shall not exceed $75,000 per year. In such event, McDonough
may designate which policy premium(s) that the Company should pay consistent with the foregoing
provision.



(e) The Company shall indemnify McDonough in accordance with the terms and conditions of its
then current indemnification agreements with directors of the Company.



(f) In the event that McDonough becomes disabled and is unable to perform his duties as Vice
Chairman, he shall continue to receive as disability income the amount of his base salary under
Section 3(a) through the end of the Employment Period, but the Board may elect another
person to serve as Vice Chairman of the Board during the period of McDonough’s disability.



(g) The Company shall provide McDonough with an automobile allowance in the amount of $1,000
per month for an automobile for use by McDonough in the performance of McDonough’s duties
hereunder. Following execution of the Agreement, the Company shall transfer to McDonough the title
to the gold 1998 Jaguar XJ that he has been driving. McDonough shall be responsible for and shall
pay all of the costs and expenses related to such automobile (including, without limitation, DMV
registration, insurance and maintenance costs and expenses).



(h) The Company shall continue to reimburse McDonough for one “social” membership at the
Marbella Country Club, located in San Juan Capistrano, California for the duration of the
Employment Period.



2. EFFECT ON EMPLOYMENT AGREEMENT.



This Amendment shall supersede and replace any inconsistent provisions of the Employment
Agreement. Except as amended hereby, the Employment Agreement shall continue in full force and
effect in accordance with its terms.



3. GOVERNING LAW.




This Amendment shall be interpreted and construed under California law.



4. COUNTERPARTS.



This Amendment may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument.



[Signatures appear on the next page]






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IN WITNESS WHEREOF, the parties hereto have executed this Amendment on the date and year first
above written.




REMEDYTEMP, INC.




By:




Name:




Its:




Robert Emmett McDonough, Sr.




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