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                                                                   EXHIBIT 10.7


                              EMPLOYMENT AGREEMENT

         This EMPLOYMENT AGREEMENT ("Agreement") is effective as of October 25,
2000 (the "Effective Date"), by and between REPUBLIC SERVICES, INC., a Delaware
corporation (the "Company"), and JAMES E. O'CONNOR, a Florida resident (the
"Employee").

         Employee and the Company are parties to that Employment Agreement
dated as of December 7, 1998 (the "Existing Employment Agreement") which is due
to expire December 7, 2001.

         Employee is currently an employee of the Company and is considered a
valued employee that Company desires to retain by reconfirming the employment
relationship pursuant to the terms of this Agreement.

         In consideration of the mutual representations, warranties, covenants
and agreements contained in this Agreement and other good and valuable
consideration the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:

         1.       EMPLOYMENT.

                  (a) RETENTION. The Company agrees to employ and/or continue
the employment of the Employee as its President and Chief Executive Officer,
and the Employee agrees to accept such employment, subject to the terms and
conditions of this Agreement. The Company also agrees that the Employee shall
continue to serve on the Company's Board of Directors until the next annual
meeting of stockholders of the Company, and that he shall be nominated for
election to the Board at each annual meeting of the stockholders of the Company
as long as this Agreement remains in effect.

                  (b) EMPLOYMENT PERIOD. This Agreement shall commence on the
Effective Date and, unless terminated in accordance with the terms of this
Agreement shall continue in effect on a rolling three-year basis, such that at
any time during the term of this Agreement there will be three years remaining
(the "Employment Period"). Notwithstanding the evergreen nature of the
Employment Period, the Company may terminate Employee at any time in accordance
with the provisions of Section 3 of this Agreement.

                  (c) DUTIES AND RESPONSIBILITIES. During the Employment
Period, the Employee shall serve as President and Chief Executive Officer and
shall have such authority and responsibility and perform such duties as may be
assigned to him from time to time at the direction of the Board of Directors of
the Company, and in the absence of such assignment, such duties as are
customary to Employee's office and as are necessary or appropriate to the
business and operations of the Company. During the Employment Period, the
Employee's employment shall be full time and the Employee shall perform his
duties honestly, diligently, in good faith and in the best interests of the
Company and shall use his best efforts to promote the interests of the Company.

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All executive officers of the Company (except for the Chairman and the Vice
Chairman) shall report to the Chief Executive Officer, and the Employee shall
in that capacity have the authority and responsibility to assign appropriate
duties to such other executive officers as are necessary or appropriate for the
business and operations of the Company.

                  (d) OTHER ACTIVITIES. Except upon the prior written consent
of the Company, the Employee, during the Employment Period, will not accept any
other employment. The Employee shall be permitted to engage in any
non-competitive businesses, not-for-profit organizations and other ventures,
such as passive real estate investments, serving on charitable and civic boards
and organizations, and similar activities, so long as such activities do not
materially interfere with or detract from the performance of Employee's duties
or constitute a breach of any of the provisions contained in Section 6 of this
Agreement.

         2.       COMPENSATION.

                  (a) BASE SALARY. In consideration for the Employee's services
hereunder and the restrictive covenants contained herein, the Employee shall be
paid an annual base salary of $510,000 for the 2000 Fiscal Year, $650,000 for
the 2001 Fiscal Year and $790,000 for the 2002 Fiscal Year (the "Salary"),
payable in accordance with the Company's customary payroll practices.
Notwithstanding the foregoing, Employee's annual Salary may be increased at
anytime and from time to time to levels greater than the levels set forth in
the preceding sentence at the discretion of the Board of Directors of the
Company to reflect merit or other increases. The Salary for each Fiscal Year
shall become effective as of January 1 of such Fiscal year. The Employee's
Salary for any Fiscal Year after 2002 shall remain as set for the 2002 Fiscal
Year unless the Board of Directors expressly provides otherwise.

                  (b) BONUS. In addition to the Salary, the Employee shall be
eligible to receive a bonus ("Bonus") in an amount up to 60% of the Employee's
Base Salary during the 2000 Fiscal Year, in an amount up to 60% of the
Employee's Base Salary during the 2001 Fiscal Year and in an amount up to 70%
of the Employee's Base Salary for the 2002 Fiscal Year. The Bonus shall be
based on the achievement of corporate goals and objectives as established by
the Compensation Committee of the Board of Directors. The achievement of said
goals and objectives shall be determined by the Compensation Committee of the
Board of Directors. With respect to any Fiscal Year during which the Employee
is employed by the Company for less than the entire Fiscal Year, the Bonus
shall be prorated for the period during which the Employee was so employed. The
Bonus shall be payable within thirty (30) days after the end of the Company's
Fiscal Year. The term "Fiscal Year" as used herein shall mean each period of
twelve (12) calendar months commencing on January 1st of each calendar year
during the Employment Period and expiring on December 31st of such year. The
maximum percentage of Base Salary which the Employee's Bonus for any year after
the 2002 Fiscal Year may represent shall remain as set for the 2002 Fiscal Year
unless the Board of Directors expressly provides otherwise.

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                  (c) MERIT AND OTHER BONUSES. Employee shall be entitled to
such other bonuses as may be determined by the Board of Directors of the
Company or by a committee of the Board of Directors as determined by the Board
of Directors, in its sole discretion.

                  (d) EXISTING STOCK OPTIONS. The Company has issued to the
Employee options to purchase shares of the Company's Common Stock pursuant to
the terms of various Option Agreements and the terms of the Company's 1998
Stock Incentive Plan (the "Outstanding Option Grants"). The options issued or
to be issued under the Outstanding Option Grants shall continue to be subject
to the terms of the Option Agreements, except to the extent otherwise provided
for in this Agreement.

                  (e) OTHER STOCK OPTIONS. The Employee shall be entitled to
participate and receive option grants under the 1998 Stock Incentive Plan and
such other incentive or stock option plans as may be in effect from
time-to-time, as determined by the Board of Directors of the Company.

                  (f) OTHER COMPENSATION PROGRAMS. The Employee shall be
entitled to participate in the Company's incentive and deferred compensation
programs and such other programs as are established and maintained for the
benefit of the Company's employees or executive officers, subject to the
provisions of such plans or programs.

                  (g) HEALTH INSURANCE. The Company shall pay for Employee's
and his family's health insurance including without limitation comprehensive
major medical and hospitalization coverage including dental and optical
coverage under all group medical plans from time to time in effect for the
benefit of the Company's employees or executive officers.

                  (h) LIFE INSURANCE. The Company shall purchase and maintain
in effect one or more term insurance policies on the life of the Employee in an
aggregate amount not less than two times his Base Salary in effect from time to
time during the term of employment. The beneficiary of such policy shall be the
person or persons who the Employee designates in writing to the Company.

                  (i) DISABILITY INSURANCE. The Company shall pay for the
Employee to participate in the Company's disability insurance in effect from
time to time. The Company shall pay for the maximum coverage commercially
available. To the extent the Company does not have a disability insurance plan
or other retirement plan, then the Company shall arrange, at its expense, for
the Employee to participate in such plan.

                  (j) OTHER BENEFITS. During the term of this Agreement, the
Employee shall also be entitled to participate in any other health insurance
programs, life insurance programs, disability programs, stock option plans,
bonus plans, pension plans and other fringe benefit plans and programs as are
from time to time established and maintained for the benefit of the Company's
employees or executive officers, subject to the provisions of such plans and
programs.

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                  (k) EXPENSES. The Employee shall be reimbursed for all
out-of-pocket expenses reasonably incurred by him on behalf of or in connection
with the business of the Company, pursuant to the normal standards and
guidelines followed from time to time by the Company.

         3.       TERMINATION.

                  (a) FOR CAUSE. The Company shall have the right to terminate
this Agreement and to discharge the Employee for Cause (as defined below), at
any time during the term of this Agreement. Termination for Cause shall mean,
during the term of this Agreement, (i) Employee's willful and continued failure
to substantially perform his duties after he has received written notice from
the Company identifying the actions or omissions constituting willful and
continued failure to perform, (ii) Employee's conduct that would constitute a
crime under federal or state law, (iii) Employee's actions or omissions that
constitute fraud, dishonesty or gross misconduct, (iv) Employee's breach of any
fiduciary duty that causes material injury to the Company, (v) Employee's
breach of any duty causing material injury to the Company, (vi) Employee's
inability to perform his material duties to the reasonable satisfaction of the
Company due to alcohol or other substance abuse, or (vii) any violation of the
Company's policies or procedures involving discrimination, harassment,
substance abuse or work place violence. Any termination for Cause pursuant to
this Section shall be given to the Employee in writing and shall set forth in
detail all acts or omissions upon which the Company is relying to terminate the
Employee for Cause.

          Upon any determination by the Company that Cause exists to terminate
the Employee, the Company shall cause a special meeting of the Board of
Directors to be called and held at a time mutually convenient to the Board of
Directors and Employee, but in no event later than ten (10) business days after
Employee's receipt of the notice that the Company intends to terminate the
Employee for Cause. Employee shall have the right to appear before such special
meeting of the Board of Directors with legal counsel of his choosing to refute
such allegations and shall have a reasonable period of time to cure any actions
or omissions which provide the Company with a basis to terminate the Employee
for Cause (provided that such cure period shall not exceed 30 days). A majority
of the members of the Board of Directors must affirm that Cause exists to
terminate the Employee. No finding by the Board of Directors will prevent the
Employee from contesting such determination through appropriate legal
proceedings provided that the Employee's sole remedy shall be to sue for
damages, not reinstatement, and damages shall be limited to those that would be
paid to the Employee if he had been terminated without Cause. In the event the
Company terminates the Employee for Cause, the Company shall only be obligated
to continue to pay in the ordinary and normal course of its business to the
Employee his Salary plus accrued but unused vacation time through the
termination date and the Company shall have no further obligations to Employee
from and after the date of termination.

                  (b) RESIGNATION BY EMPLOYEE WITHOUT GOOD REASON. If the
Employee shall resign or otherwise terminate his employment with the Company at
anytime during the term of this Agreement, other than for Good Reason (as
defined below), the Employee shall only be entitled to

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receive his accrued and unpaid Salary through the termination date, and the
Company shall have no further obligations under this Agreement from and after
the date of resignation.

                  (c) TERMINATION BY COMPANY WITHOUT CAUSE AND BY EMPLOYEE FOR
GOOD REASON. At any time during the term of this Agreement, (i) the Company
shall have the right to terminate this Agreement and to discharge the Employee
without Cause effective upon delivery of written notice to the Employee, and
(ii) the Employee shall have the right to terminate this Agreement for Good
Reason effective upon delivery of written notice to the Company. For purposes
of this Agreement, "Good Reason" shall mean: (i) the Company has materially
reduced the duties and responsibilities of the Employee to a level not
appropriate for an officer of a publicly-traded company holding the position
provided for in Section 1(a), (ii) the Company has breached any material
provision of this Agreement and has not cured such breach within 30 days of
receipt of written notice of such breach from the Employee, (iii) Company has
reduced the Employee's annual Salary by more than 10% from the prior Fiscal
Year (nothing in this clause implies that the Company may reduce the Employee's
Salary below the levels provided for in Section 2(a)), (iv) the Company has
terminated the Employee's participation in one or more of the Company's
sponsored benefit or incentive plans and no other executive officer has had his
participation terminated, (v) a failure by the Company (1) to continue any
bonus plan, program or arrangement in which Employee in which Employee is
entitled to participate ("Bonus Plans"), provided that any such Bonus Plans may
be modified at the Company's discretion from time to time but shall be deemed
terminated if (x) any such plan does not remain substantially in the form in
effect prior to such modification and (y) if plans providing Employee with
substantially similar benefits are not substituted therefor ("Substitute
Plans"), or (2) to continue Employee as a participant in the Bonus Plans and
Substitute Plans on at least a basis which is substantially the same as to
potential amount of the bonus the Employee participated in prior to any change
in such plans or awards, in accordance with the Bonus Plans and the Substitute
Plans (a plan shall be considered to be on a basis substantially the same as
another if the potential amount payable thereunder is at least 90% of the
potential amount payable under the other plan), (vi) the Employee's office is
relocated by the Company to a location which is not located within the Florida
counties of Miami-Dade, Broward or Palm Beach, or (vii) the Company's
termination without Cause of the continuation of the Employment Period provided
in this Agreement. Upon any such termination by the Company without Cause, or
by the Employee for Good Reason, the Company shall pay to the Employee all of
the Employee's accrued but unpaid Salary through the date of termination, and
continue to pay to or provide for the Employee (a) his Salary payable in
accordance with Section 2(a) for three (3) years from the date of termination,
when and as the same would have been due and payable hereunder but for such
termination, (b) all health benefits in which Employee was entitled to
participate at any time during the 12-month period prior to the date of
termination, until the earliest to occur of the third anniversary of the date
of termination, the Employee's death, or the date on which the Employee becomes
covered by a comparable health benefit plan by a subsequent employer; provided,
however, that in the event that Employee's continued participation in any
health benefit plan of the Company is prohibited, the Company will arrange to
provide Employee with benefits substantially similar to those which Employee
would have been entitled to receive under such plan for such period on a basis
which provides Employee with no additional after tax cost, (c) all stock option
grants, or other stock grants

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whether part of the Outstanding Option Grant or any options issued during the
term of this Agreement, will immediately vest and such options will remain
exercisable for the lesser of the unexpired term of the option without regard
to the termination of Employee's employment or three (3) years from the date of
termination of employment, (d) all long term incentive cash grants provided to
the Employee shall immediately vest as if all targets and conditions had been
met and shall be paid by the Company to the Employee at such times as the
Company would have been required to make such payments if this Agreement had
remained in effect, provided, however, that in the case of incentives partially
or completely contingent on the providing of service for a specific period of
time, the total amount to be paid by the Company shall be equal to the maximum
amount payable if all conditions were met, multiplied by a fraction, the
numerator of which is the period of service that would have been served if the
Employee's employment had terminated as of the last day of the fiscal year in
which his employment was terminated, and the denominator of which is the total
period of time specified as a condition to the incentive, and (e) as of the
termination date the Employee shall be paid the balance of all amounts credited
to Employee's deferred compensation account plus a gross-up payment to
reimburse the Employee for all income and other taxes imposed with respect to
the payment of said balance and all income and other taxes arising as a result
of said gross-up payment such that the payment of the deferred compensation
balance of the Employee is made to the Employee free of all taxes thereon
whatsoever (collectively, the foregoing consideration payable to the Employee
shall be referred to herein as the "Severance Payment"). Other than the
Severance Payment, the Company shall have no further obligation to the Employee
except for the obligations set forth in Section 13 of this Agreement after the
date of such termination; PROVIDED, HOWEVER, that the Employee shall only be
entitled to continuation of the Severance Payments as long as he is in
compliance with the provisions of Sections 6 and 7 of this Agreement.

                  (d) DISABILITY OF THE EMPLOYEE. This Agreement may be
terminated by the Company upon the Disability of the Employee. "Disability"
shall mean any mental or physical illness, condition, disability or incapacity
which prevents the Employee from reasonably discharging his duties and
responsibilities under this Agreement for a period of 180 consecutive days. In
the event that any disagreement or dispute shall arise between the Company and
the Employee as to whether the Employee suffers from any Disability, then, in
such event, the Employee shall submit to the physical or mental examination of
a physician licensed under the laws of the State of Florida, who is mutually
agreeable to the Company and the Employee, and such physician shall determine
whether the Employee suffers from any Disability. In the absence of fraud or
bad faith, the determination of such physician shall be final and binding upon
the Company and the Employee. The entire cost of such examination shall be paid
for solely by the Company. In the event the Company has purchased Disability
insurance for Employee, the Employee shall be deemed disabled if he is
completely (fully) disabled as defined by the terms of the Disability policy.
In the event that at any time during the term of this Agreement the Employee
shall suffer a Disability and the Company terminates the Employee's employment
for such Disability, such Disability shall be considered to be a termination by
the Company without Cause or a termination by the Employee for Good Reason and
the Severance Payments shall be paid to the Employee to the same extent and in
the same manner as provided for in paragraph (c) above, except that payment of
the Salary in

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accordance with said paragraph shall be mitigated to the extent payments are
made to the Employee pursuant to disability insurance programs maintained by
the Company.

                  (e) DEATH OF THE EMPLOYEE. If during the term of this
Agreement the Employee shall die, then the employment of the Employee by the
Company shall automatically terminate on the date of the Employee's death. In
such event, the Employee's death shall be considered to be a termination by the
Company without Cause or a termination by the Employee for Good Reason and the
Severance Payments shall be paid to the Employee's personal representative or
estate to the same extent and in the same manner as provided for in paragraph
(c) above, without mitigation for any insurance policies or other benefits held
by the Employee. Once such payments have been made to the Employee's personal
representative or estate as the case may be, the Company shall have no further
obligations under this Agreement or otherwise to said personal representative
or estate, or to any heirs of the Employee.

         4.       TERMINATION OF EMPLOYMENT BY EMPLOYEE FOR CHANGE OF CONTROL.

                  (a) TERMINATION RIGHTS. Notwithstanding the provisions of
Section 2 and Section 3 of this Agreement, in the event that there shall occur
a Change of Control (as defined below) of the Company and within two years
after such Change of Control the Employee's employment hereunder is terminated
by the Company without Cause or by the Employee for Good Reason, then the
Company shall be required to pay to the Employee (i) the Severance Payment
provided in Section 3(c), except that such Severance Payment shall be paid in a
single lump sum in full, (ii) the product of three multiplied by the maximum
Bonus that Executive would have been eligible for with respect to the Fiscal
Year in which such termination occurs, assuming that all performance objectives
are met, in a single lump sum. The foregoing payments shall be made no later
than 10 days after the Employee's termination pursuant to this Section 4. To
the extent that payments are owed by the Company to the Employee pursuant to
this Section 4, they shall be made in lieu of payments pursuant to Section 3,
and in no event shall the Company be required to make payments or provide
benefits to the Employee under both Section 3 and Section 4.

                  (b) CHANGE OF CONTROL OF THE COMPANY DEFINED. For purposes of
this Section 4, the term "Change of Control of the Company" shall mean any
change in control of the Company of a nature which would be required to be
reported (i) in response to Item 6(e) of Schedule 14A of Regulation 14A, as in
effect on the date of this Agreement, promulgated under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), (ii) in response to Item 1 of the
Current Report on Form 8-K, as in effect on the date of this Agreement,
promulgated under the Exchange Act, or (iii) in any filing by the Company with
the Securities and Exchange Commission; provided, however, that without
limitation, a Change of Control of the Company shall be deemed to have occurred
if:

                           (i) Any "person" (as such term is defined in
Sections 13(d)(3) and Section 14(d)(3) of the Exchange Act), other than the
Company, any majority-owned subsidiary of the Company, or any compensation plan
of the Company or any majority-owned subsidiary of the

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Company, becomes the "beneficial owner" (as such term is defined in Rule 13d-3
of the Exchange Act), directly or indirectly, of securities of the Company
representing thirty percent (30%) or more of the combined voting power of the
Company;

                           (ii) During any period of three consecutive years
during the term of this Agreement, the individuals who at the beginning of such
period constitute the Board of Directors of the Company cease for any reason to
constitute at least a majority of such Board of Directors, unless the election
of each director who was not a director at the beginning of such period has
been approved in advance by directors representing at least two-thirds of the
directors then in office who were directors at the beginning of such period; or

                           (iii) The shareholders of the Company approve (1) a
reorganization, merger, or consolidation with respect to which persons who were
the shareholders of the Company immediately prior to such reorganization,
merger, or consolidation do not immediately thereafter own more than 50% of the
combined voting power entitled to vote generally in the election of the
directors of the reorganized, merged or consolidated entity; (2) a liquidation
or dissolution of the Company; or (3) the sale of all or substantially all of
the assets of the Company or of a subsidiary of the Company that accounts for
30% of the consolidated revenues of the Company, but not including a
reorganization, merger or consolidation of the Company.

         5.       GROSS-UP PAYMENT.

                  (a) AMOUNT. If any payment or benefit provided to the
Employee by the Company (a "Base Payment") is subject to the tax (the "Excise
Tax") imposed by Section 4999 of the Internal Revenue Code of 1986, as amended
(the "Code") (or any other similar tax that may hereafter be imposed), the
Company shall pay to the Employee the "Gross-Up Payment" determined as follows.
The "Gross-Up Payment" shall be equal to the sum of (i) the Excise Tax imposed
with respect to the Base Payment, plus (ii) the Excise Tax imposed with respect
to the Gross-Up Payment, plus (iii) all other taxes imposed on the Employee
with respect to the Gross-Up Payment, including income taxes and the Employee's
share of FICA, FUTA and other payroll taxes. The Gross-Up Payment shall not
include the payment of any tax on the Base Payment other than the Excise Tax.
The Gross-Up Payment is intended to place the Employee in the same economic
position the Employee would have been in if the Excise Tax did not apply, and
shall be calculated in accordance with such intent.

                  (b) TAX RATES AND ASSUMPTIONS. For purposes of determining
the amount of the Gross-Up Payment, the Employee shall be deemed to pay Federal
income taxes at the highest marginal rate of Federal income taxation in the
calendar year in which the Gross-Up Payment is to be made, and state and local
income taxes at the highest marginal rate of taxation in the state and locality
of the Employee's residence on the date of termination, net of the maximum
reduction in Federal income taxes which could be obtained from deduction of
such state and local taxes.

                  (c) PAYMENT AND CALCULATION PROCEDURES. The Gross-Up Payment
attributable to a Base Payment shall be paid to the Employee in cash and at
such times as such Base Payment is

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paid or provided pursuant to this Agreement. Simultaneously with or prior to
the Company's payment of a Base Payment, the Company shall deliver to the
Employee a written statement specifying the total amount of the Base Payment
and the Excise Tax and Gross-Up Payment relating to the Base Payment, if any,
together with all supporting calculations and conclusions. If the Employee
disagrees with the Company's determination of the Excise Tax or Gross-Up
Payment, the Employee shall submit to the Company, no later than 30 days after
receipt of the Company's written statement, a written notice advising the
Company of the disagreement and setting forth the Employee's calculation of
said amounts. The Employee's failure to submit such notice within such period
shall be conclusively deemed to be an agreement by the Employee as to the
amount of the Excise Tax and Gross-Up Payment, if any. If the Company agrees
with the Employee's calculations, it shall pay any shortfall in the Gross-Up
Payment to the Employee within 20 days after receipt of such a notice from the
Employee. If the Company does not agree with the Employee's calculations, it
shall provide the Employee with a written notice within 20 days after the
receipt of the Employee's calculations advising the Employee that the
disagreement is to be referred to an independent accounting firm for
resolution. Such disagreement shall be referred to an independent "Big 5"
accounting firm which is not the regular accounting firm of the Company and
which is designated by the Company. The Company shall be required to designate
such accounting firm within 10 days after issuance of the Company's notice of
disagreement. The accounting firm shall review all information provided to it
by the parties and submit a written report to the parties setting forth its
calculation of the Excise Tax and the Gross-Up Payment within 15 days after
submission of the matter to it, and such decision shall be final and binding on
all of the parties. The fees and expenses charged by said accounting firm shall
be paid by the Company. If the amount of the Gross-Up Payment actually paid by
the Company was less than the amount calculated by the accounting firm, the
Company shall pay the shortfall to the Employee within 5 days after the
accounting firm submits its written report. If the amount of the Gross-Up
Payment actually paid by the Company was greater than the amount calculated by
the accounting firm, the Employee shall pay the excess to the Company within 5
days after the accounting firm submits its written report.

                  (d) SUBSEQUENT RECALCULATION. In the event the Internal
Revenue Service or other applicable governmental authority imposes an Excise
Tax with respect to a Base Payment that is greater than the amount of the
Excise Tax determined pursuant to the immediately preceding paragraph, the
Company shall reimburse the Employee for the full amount of such additional
Excise Tax plus any interest and penalties which may be imposed in connection
therewith, and pay to the Employee a Gross-up Payment sufficient to make the
Employee whole and reimburse the Employee for any Excise Tax, income tax and
other taxes imposed on the reimbursement of such additional Excise Tax and
interest and penalties, in accordance with the principles set forth above.

                  (e) Example. The calculation of the Gross-Up Payment is
illustrated by the example set forth in Schedule 5(e), attached to this
Agreement and hereby incorporated by reference. The amounts set forth in such
example are for illustration purposes only and no implication shall be drawn
from such example as to the amounts otherwise payable to the Employee by the
Company.

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         6. SUCCESSOR TO COMPANY. The Company shall require any successor,
whether direct or indirect, to all or substantially all of the business,
properties and assets of the Company whether by purchase, merger, consolidation
or otherwise, prior to or simultaneously with such purchase, merger,
consolidation or other acquisition to execute and to deliver to the Employee a
written instrument in form and in substance reasonably satisfactory to the
Employee pursuant to which any such successor shall agree to assume and to
timely perform or to cause to be timely performed all of the Company's
covenants, agreements and obligations set forth in this Agreement (a "Successor
Agreement"). The failure of the Company to cause any such successor to execute
and deliver a Successor Agreement to the Employee shall constitute a material
breach of the provisions of this Agreement by the Company.

         7. RESTRICTIVE COVENANTS. In consideration of his employment and the
other benefits arising under this Agreement, the Employee agrees that during
the term of this Agreement, and for a period of three (3) years following the
termination of this Agreement, the Employee shall not directly or indirectly:

                  (a) alone or as a partner, joint venturer, officer, director,
member, employee, consultant, agent, independent contractor or stockholder of,
or lender to, any company or business, (i) engage in the business of solid
waste collection, disposal or recycling (the "Solid Waste Services Business")
in any market in which the Company or any of its subsidiaries or affiliates
does business, or any other line of business which is entered into by the
Company or any of its subsidiaries or affiliates during the term of this
Agreement, or (ii) compete with the Company or any of its subsidiaries or
affiliates in acquiring or merging with any other business or acquiring the
assets of such other business; or

                  (b) for any reason, (i) induce any customer of the Company or
any of its subsidiaries or affiliates to patronize any business directly or
indirectly in competition with the Solid Waste Services Business conducted by
the Company or any of its subsidiaries or affiliates in any market in which the
Company or any of its subsidiaries or affiliates does business; (ii) canvass,
solicit or accept from any customer of the Company or any of its subsidiaries
or affiliates any such competitive business; or (iii) request or advise any
customer or vendor of the Company or any of its subsidiaries or affiliates to
withdraw, curtail or cancel any such customer's or vendor's business with the
Company or any of its subsidiaries or affiliates; or

                  (c) for any reason, employ, or knowingly permit any company
or business directly or indirectly controlled by him, to employ, any person who
was employed by the Company or any of its subsidiaries or affiliates at or
within the prior six months, or in any manner seek to induce any such person to
leave his or her employment.

                   Notwithstanding the foregoing, the beneficial ownership of
less than five percent (5%) of the shares of stock of any corporation having a
class of equity securities actively traded on a national securities exchange or
over-the-counter market shall not be deemed, in and of itself, to violate the
prohibitions of this Section.

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         8. CONFIDENTIALITY. The Employee agrees that at all times during the
term of this Agreement and after the termination of employment for as long as
such information remains non- public information, the Employee shall (i) hold
in confidence and refrain from disclosing to any other party all information,
whether written or oral, tangible or intangible, of a private, secret,
proprietary or confidential nature, of or concerning the Company or any of its
subsidiaries or affiliates and their business and operations, and all files,
letters, memoranda, reports, records, computer disks or other computer storage
medium, data, models or any photographic or other tangible materials containing
such information ("Confidential Information"), including without limitation,
any sales, promotional or marketing plans, programs, techniques, practices or
strategies, any expansion plans (including existing and entry into new
geographic and/or product markets), and any customer lists, (ii) use the
Confidential Information solely in connection with his employment with the
Company or any of its subsidiaries or affiliates and for no other purpose,
(iii) take all precautions necessary to ensure that the Confidential
Information shall not be, or be permitted to be, shown, copied or disclosed to
third parties, without the prior written consent of the Company or any of its
subsidiaries or affiliates, and (iv) observe all security policies implemented
by the Company or any of its subsidiaries or affiliates from time to time with
respect to the Confidential Information. In the event that the Employee is
ordered to disclose any Confidential Information, whether in a legal or
regulatory proceeding or otherwise, the Employee shall provide the Company or
any of its subsidiaries or affiliates with prompt notice of such request or
order so that the Company or any of its subsidiaries or affiliates may seek to
prevent disclosure. In addition to the foregoing the Employee shall not at any
time libel, defame, ridicule or otherwise disparage the Company.

         9. SPECIFIC PERFORMANCE; INJUNCTION. The parties agree and acknowledge
that the restrictions contained in Sections 7 and 8 are reasonable in scope and
duration and are necessary to protect the Company or any of its subsidiaries or
affiliates. If any provision of Section 7 or 8 as applied to any party or to
any circumstance is adjudged by a court to be invalid or unenforceable, the
same shall in no way affect any other circumstance or the validity or
enforceability of any other provision of this Agreement. If any such provision,
or any part thereof, is held to be unenforceable because of the duration of
such provision or the area covered thereby, the parties agree that the court
making such determination shall have the power to reduce the duration and/or
area of such provision, and/or to delete specific words or phrases, and in its
reduced form, such provision shall then be enforceable and shall be enforced.
The Employee agrees and acknowledges that the breach of Section 7 or 8 will
cause irreparable injury to the Company or any of its subsidiaries or
affiliates and upon breach of any provision of such Sections, the Company or
any of its subsidiaries or affiliates shall be entitled to injunctive relief,
specific performance or other equitable relief, without being required to post
a bond; PROVIDED, HOWEVER, that, this shall in no way limit any other remedies
which the Company or any of its subsidiaries or affiliates may have (including,
without limitation, the right to seek monetary damages).

         10. NOTICES. All notices, requests, demands, claims and other
communications hereunder shall be in writing and shall be deemed given if
delivered by hand delivery, by certified or registered mail (first class
postage pre-paid), guaranteed overnight delivery or facsimile transmission if
such

                                     - 11 -

<PAGE>   12



transmission is confirmed by delivery by certified or registered mail (first
class postage pre-paid) or guaranteed overnight delivery to, the following
addresses and telecopy numbers (or to such other addresses or telecopy numbers
which such party shall designate in writing to the other parties): (a) if to
the Company, at its principal executive offices, addressed to the Chairman of
the Board, with a copy to the General Counsel; and (b) if to the Employee, at
the address listed on the signature page hereto.

         11. AMENDMENT; WAIVER. This Agreement may not be modified, amended, or
supplemented, except by written instrument executed by all parties. No failure
to exercise, and no delay in exercising, any right, power or privilege under
this Agreement shall operate as a waiver, nor shall any single or partial
exercise of any right, power or privilege hereunder preclude the exercise of
any other right, power or privilege. No waiver of any breach of any provision
shall be deemed to be a waiver of any preceding or succeeding breach of the
same or any other provision, nor shall any waiver be implied from any course of
dealing between the parties. No extension of time for performance of any
obligations or other acts hereunder or under any other agreement shall be
deemed to be an extension of the time for performance of any other obligations
or any other acts. The rights and remedies of the parties under this Agreement
are in addition to all other rights and remedies, at law or equity, that they
may have against each other.

         12. ASSIGNMENT; THIRD PARTY BENEFICIARY. This Agreement, and the
Employee's rights and obligations hereunder, may not be assigned or delegated
by him. The Company may assign its rights, and delegate its obligations,
hereunder to any affiliate of the Company, or any successor to the Company or
its Solid Waste Services Business, specifically including the restrictive
covenants set forth in Section 7 hereof. The rights and obligations of the
Company under this Agreement shall inure to the benefit of and be binding upon
its respective successors and assigns.

         13. SEVERABILITY; SURVIVAL. In the event that any provision of this
Agreement is found to be void and unenforceable by a court of competent
jurisdiction, then such unenforceable provision shall be deemed modified so as
to be enforceable (or if not subject to modification then eliminated herefrom)
to the extent necessary to permit the remaining provisions to be enforced in
accordance with the parties intention. The provisions of Sections 7 and 8 will
survive the termination for any reason of the Employee's relationship with the
Company.

         14. INDEMNIFICATION. The Company agrees to indemnify the Employee
during the term and after termination of this Agreement in accordance with the
provisions of the Company's certificate of incorporation and bylaws and the
Delaware General Corporation Law.

         15. COUNTERPARTS. This Agreement may be signed in any number of
counterparts, each of which shall be an original but all of which together
shall constitute one and the same instrument.

         16. GOVERNING LAW. This Agreement shall be construed in accordance
with and governed for all purposes by the laws of the State of Florida
applicable to contracts executed and to be wholly performed within such State.

                                     - 12 -

<PAGE>   13




         17. ENTIRE AGREEMENT. This Agreement contains the entire understanding
of the parties in respect of its subject matter and supersedes all prior
agreements and understandings (oral or written) between or among the parties
with respect to such subject matter. Upon the execution of this Agreement the
provisions of the Existing Employment Agreement shall be superseded and shall
be of no further force and effect except as specifically preserved by the terms
of this Agreement.

         18. HEADINGS. The headings of Paragraphs and Sections are for
convenience of reference and are not part of this Agreement and shall not
affect the interpretation of any of its terms.

         19. CONSTRUCTION. This Agreement shall be construed as a whole
according to its fair meaning and not strictly for or against any party. The
parties acknowledge that each of them has reviewed this Agreement and has had
the opportunity to have it reviewed by their respective attorneys and that any
rule of construction to the effect that ambiguities are to be resolved against
the drafting party shall not apply in the interpretation of this Agreement.

         20. ATTORNEY'S FEES. If at any time following a Change of Control of
the Company there should arise any dispute as to the validity, interpretation
or application of any term or condition of this agreement, the Company agrees,
upon written demand by the Employee (and Employee shall be entitled upon
application to any court of competent jurisdiction, to the entry of a mandatory
injunction, without the necessity of posting any bond with respect thereto,
compelling the Company) to promptly provide sums sufficient to pay on a current
basis (either directly or by reimbursing Employee) Employee's costs and
reasonable attorneys' fees (including expenses of investigation and
disbursements for the fees and expenses of experts, etc.) incurred by the
Employee in connection with any such dispute or any litigation, provided that
Employee shall repay any such amounts paid or advanced if Employee is not the
prevailing party with respect to at least one material claim or issue in such
dispute or litigation. If at any time when there has not previously been a
Change of Control of the Company, there should arise any dispute or litigation
as to the validity, interpretation or application of any term or condition of
the Agreement, the prevailing party in such dispute or litigation shall be
entitled to recover from the non-prevailing party its costs and reasonable
attorneys' fees (including expenses of investigation and disbursements for the
fees and expenses of experts, etc.) incurred in such dispute or litigation. The
provisions of this Section 20, without implication as to any other section
hereof, shall survive the expiration or termination of this Agreement and
Employee's employment hereunder.

         21. WITHHOLDING. All payments made to the Employee shall be made net
of any applicable withholding for income taxes, Excise Tax and the Employee's
share of FICA, FUTA or other taxes. The Company shall withhold such amounts
from such payments to the extent required by applicable law and remit such
amounts to the applicable governmental authorities in accordance with
applicable law.

                         [SIGNATURES ON FOLLOWING PAGE]

                                     - 13 -

<PAGE>   14



         IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first above written.

                                    REPUBLIC SERVICES, INC., a Delaware
                                    corporation

                                    By: /s/ HARRIS W. HUDSON
                                       -----------------------------------
                                         Harris W. Hudson, Vice Chairman



                                    EMPLOYEE:

                                    /s/ JAMES E. O'CONNOR
                                    --------------------------------------
                                    JAMES E. O'CONNOR

                                    Address for Notices:

                                    8190 NW 47th Drive
                                    Coral Springs, FL 33067




                                     - 14 -