TALEO CORPORATION LOUIS TETU EMPLOYMENT AGREEMENT

Exhibit 10.7

TALEO CORPORATION

▇▇▇▇▇ ▇▇▇▇ EMPLOYMENT AGREEMENT

     This Agreement is entered into effective as of March 28, 2005 (the “Effective Date”) by and between Taleo Canada Inc. (“Taleo Canada”), a wholly owned subsidiary of Taleo Corporation, a Delaware corporation (“Taleo” and collectively with Taleo Canada (collectively, the “Company”)) and ▇▇▇▇▇ ▇▇▇▇ (“Executive”).

     1. Duties and Scope of Employment.

          (a) Term, Position and Duties. As of the Effective Date, Executive will serve as the Taleo’s executive Chairman of the Board. Executive will be a full-time employee of the Company and will render such business and professional services as will reasonably be assigned to him by the Taleo’s Chief Executive Officer (“CEO”) or Board of Directors (the “Board”), including serving as a senior advisor to the CEO, and providing executive sponsorship for sales opportunities or any special project as directed by the CEO. The period of Executive’s employment under this Agreement shall commence on the Effective Date and continue through December 31, 2006, and is referred to herein as the “Employment Term.” The Executive’s services shall be performed at the Company’s offices in ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇.

          (b) Board Membership. Executive will continue to serve as a director of Taleo. If Taleo’s stock becomes publicly traded, Executive’s continued service as a member of the Board will be subject to Taleo’s corporate governance policies for the nomination of directors applicable to all directors and any required stockholder approval.

          (c) Obligations. During the Employment Term, Executive will devote Executive’s full business efforts and time to the Company but the Executive may serve on up to two other boards of directors, subject to the Board’s reasonable determination that such service does not conflict with his obligations to the Company. For the duration of the Employment Term, Executive agrees not to actively engage in any other employment, occupation, or consulting activity for any direct or indirect remuneration without the prior approval of the Board; provided, however, that Executive may, without the approval of the Board, serve in any capacity with any civic, educational, or charitable organization, provided such services do not interfere with Executive’s obligations to Company.

     2. At-Will Employment. Executive and the Company agree that Executive’s employment with the Company constitutes “at-will” employment. Executive and the Company acknowledge that this employment relationship may be terminated at any time, upon written notice to the other party, with or without good cause or for any or no cause, at the option either of the Company or Executive. However, as described in this Agreement, Executive may be entitled to severance benefits depending upon the circumstances of Executive’s termination of employment. Upon the termination of Executive’s employment with the Company for any reason during the Employment Term, Executive will be entitled to payment on his termination date of all accrued but unpaid salary, vacation, any earned bonuses, expense reimbursements, and other benefits due to

     Executive through his termination date under any Company-provided or paid plans, policies, and arrangements.

     3. Compensation.

          (a) Base Salary. As of the Effective Date, Taleo Canada will pay Executive an annual base salary of Canadian $250,000 as compensation for his services (the “Base Salary”). The Base Salary will be paid periodically in accordance with Taleo Canada’s normal payroll practices (but no less frequently than once per month) and be subject to the usual, required withholding.

          (b) Annual Bonus. Executive’s annual target bonus will be Canadian $50,000 (“Target Bonus”), which will be pro-rated at 75% for the year ending December 31, 2005. Executive’s annual bonus will be determined based upon achievement of performance goals approved by the Board. Executive will have the opportunity to discuss the nature of such performance goals with the Board prior to such performance goals being approved by the Board. Executive’s annual bonus, if any, will be payable annually at the end of the fiscal year; provided, however, Executive’s actual bonus earned for any fiscal year will be paid within 45 days following the end of the Company’s fiscal year.

          (c) Stock Options. Executive will be eligible to be granted options to purchase up to 100,000 shares of Taleo common stock at the discretion of the Board, based upon Executive achieving the performance goals for a fiscal year.

               (i) Any stock option will be for such number of shares of Taleo Class A common stock as determined by the Compensation Committee of the Board (the “Stock Option”). Any Stock Option will have a per-share exercise price equal to the fair market value of a share on the date of grant, will vest over a 4-year period, with 25% of the shares vesting on the first anniversary of the Effective Date, and 1/48^th of the total shares vesting monthly thereafter, or at such other vesting schedule as determined by the Board, subject to Executive continuing to remain a “Service Provider” (as defined in the Company’s 1999 Stock Plan, the “Option Plan”) to the Company on each vesting date;

               (ii) Any Stock Option shall have (x) a ten-year maximum term, and (y) otherwise have the same terms and conditions as stock options held by other senior executives of the Company, subject to Section 6. Any Stock Option granted to Executive may be exercised (a) with cash, (b) with previously owned Taleo common shares and/or (c) if Taleo’s stock is publicly traded and it is legally permissible, via a “cashless exercise” program in which payment may be made all or in part by delivery of an irrevocable direction to a securities broker to sell common shares and to deliver all or part of the sale proceeds to Taleo in payment of the aggregate option exercise and any applicable tax withholding obligations relating to the exercised option. In the event of any conflict in the express terms between this Agreement and the Option Plan and any Stock Option agreement executed by and between Executive and the Company, the express terms of this Agreement shall prevail and govern. Subject to the preceding provisions of this Section 3(c), a Stock Option will be subject to the terms, definitions and provisions of the Option Plan and the stock option agreements by and between the Executive and the Company (the “Option Agreement”), all of which documents are incorporated herein by reference.

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               (iii) The Stock Options currently held by Executive are attached hereto as Exhibit A.

     4. Employee Benefits. During the Employment Term, Executive will be eligible to participate in accordance with the terms of all Company employee benefit plans, policies, and arrangements that are applicable to other senior executives of the Company, as such plans, policies, and arrangements may exist from time to time. Executive will be entitled to five (5) weeks of paid annual vacation.

     5. Expenses. The Company will reimburse Executive for reasonable travel, entertainment, and other expenses incurred by Executive in the furtherance of the performance of Executive’s duties hereunder, in accordance with the Company’s expense reimbursement policy as in effect from time to time.

     6. Severance.

          (a) Termination Without Cause or Resignation for Good Reason. If Executive’s employment is terminated by the Company without Cause or by Executive for Good Reason, or by reason of Executive’s death of disability then, subject to Section 7, Executive will receive: (i) a lump-sum payment equal to the lesser of Executive’s annual Base Salary, or the amount of Executive’s Base Salary owing for the remaining Employment Term, paid within 30 days of termination of employment, (ii) reimbursement for any applicable premiums Executive pays to continue coverage for Executive and Executive’s eligible dependents under the Company’s health insurance plan for the lesser of the remainder of the Employment Term or twelve months after the date of termination, or, if earlier, until Executive is eligible for similar benefits from another employer (provided Executive validly elects to continue coverage under applicable law), (iii) a post-termination exercise period of twelve (12) months under all Stock Options, and (iv) immediate vesting of all unvested Stock Options. If a termination described in the preceding sentence occurs within 60 days before or 12 months following a Change of Control, Executive will receive (A) a lump-sum payment equal to the lesser of Executive’s annual Base Salary or the amount of Executive’s Base Salary owing for the then remaining Employment Term, plus 100% of the annual Target Bonus amount for the year of termination and (B) immediate vesting with respect to all unvested Stock Options that are held by Executive. Executive’s vested Stock Options will remain exercisable in accordance with the terms of the 1999 Stock Plan and the corresponding Option Agreements and thereafter will expire to the extent not exercised.

          (b) Voluntary Termination without Good Reason; Termination for Cause. If Executive’s employment with the Company terminates voluntarily by Executive without Good Reason or is terminated for Cause by the Company, then (i) all further vesting of Executive’s outstanding unvested Stock Options will terminate immediately, and Executive will receive a post-termination exercise period of twelve (12) months under all Stock Options, (ii) all payments of compensation by the Company to Executive hereunder will terminate immediately (except as to amounts already earned), (iii) Executive will be paid all accrued but unpaid salary, vacation, any earned bonuses, expense reimbursements and other benefits due to Executive through his termination date under any Company-provided or paid plans, policies, and arrangements, and (iv) Executive will be eligible for severance benefits only in accordance with the Company’s then established policies and practices.

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          (c) Sole Right to Severance. This Agreement is intended to represent Executive’s sole entitlement to severance payments and benefits in connection with the termination of his employment. To the extent Executive receives severance or similar payments and/or benefits under any other Company plan, program, agreement, policy, practice, or the like, severance payments and benefits due to Executive under this Agreement will be correspondingly reduced (and vice-versa).

     7. Conditions to Receipt of Severance; No Duty to Mitigate.

          (a) Separation Agreement and Release of Claims. The receipt of any severance pursuant to Section 6 will be subject to Executive signing and not revoking a separation agreement and release of claims in a form reasonably acceptable to the Company. Such agreement will provide (among other things) that Executive will not disparage the Company, its directors, or its executive officers for 12 months following the date of termination and the Company will instruct its officers and directors not to disparage the Executive. No severance will be paid or provided until the separation agreement and release agreement becomes effective.

          (b) No Duty to Mitigate. Executive will not be required to mitigate the amount of any payment contemplated by this Agreement, nor will any earnings that Executive may receive from any other source reduce any such payment.

          (c) Nonsolicitation. In the event of a termination of Executive’s employment that otherwise would entitle Executive to the receipt of severance pursuant to Section 6, Executive agrees that, during the 12-month period following termination of employment, Executive, directly or indirectly, whether as employee, owner, sole proprietor, partner, director, founder or otherwise, will (i) not solicit, induce, or influence any person to modify his or her employment or consulting relationship with the Company (the “No-Inducement”) and (ii) not solicit business in competition with the Company from any of the Company’s customers and users (the “No-Solicit”). If Executive breaches the No-Inducement or No-Solicit, all continuing payments and benefits to which Executive otherwise may be entitled pursuant to Section 6 will cease immediately.

     8. Definitions.

          (a) Cause. For purposes of this Agreement, “Cause” means (i) Executive’s conviction of, or plea of nolo contendere to, a felony, (ii) Executive’s repeated failure to follow lawful, reasonable instructions of the Board, (iii) Executives breach of this Agreement, or (iv) Executive’s violation or breach of any fiduciary or contractual duty to the Company which results in material damage to the Company or its business; provided that if any of the foregoing events is capable of being cured, the Company will provide written notice to Executive describing the nature of such event and Executive will thereafter have 30 days to cure such event (including the opportunity to present his case to the full Board with the assistance of his own counsel). The foregoing shall not be deemed an exclusive list of all acts or omissions that the Company may consider as grounds for the termination of Executive’s employment, but it is an exclusive list of the acts or omissions that shall be considered “Cause” for the termination of Executive’s employment by the Company. Executive shall continue to receive the compensation and benefits provided by this Agreement during the 30 day period after he receives the written notice of the Company’s intention to terminate his employment for Cause.

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          (b) Change of Control. For purposes of this Agreement, “Change of Control” means (i) a sale of all or substantially all of the Company’s assets, (ii) any merger, consolidation, or other business combination transaction of the Company with or into another corporation, entity, or person, other than a transaction in which the holders of at least a majority of the shares of voting capital stock of the Company outstanding immediately prior to such transaction continue to hold (either by such shares remaining outstanding or by their being converted into shares of voting capital stock of the surviving entity) a majority of the total voting power represented by the shares of voting capital stock of the Company (or the surviving entity) outstanding immediately after such transaction, (iii) the direct or indirect acquisition (including by way of a tender or exchange offer) by any person, or persons acting as a group, of beneficial ownership or a right to acquire beneficial ownership of shares representing a majority of the voting power of the then outstanding shares of capital stock of the Company, (iv) a contested election of Directors, as a result of which or in connection with which the persons who were Directors before such election or their nominees cease to constitute a majority of the Board, (v) a dissolution or liquidation of the Company or (vi) any definition provided by the Option Plan.

          (c) Disability. For purposes of this Agreement, Disability shall have the same defined meaning as in the Company’s long-term disability plan.

          (d) Good Reason. For purposes of this Agreement, “Good Reason” means the occurrence of any of the following without Executive’s express written consent: (i) a reduction in Executive’s position or duties other than a reduction in position or duties solely by virtue of the Company being acquired and made part of a larger entity so long as Executive continues in his same role on an adjusted basis serving as a senior executive in a division or subsidiary with no material reduction in the Executive’s operational responsibilities and duties in effect prior to the Change of Control, rather than as Chairman of the successor entity, (ii) a reduction in Executive’s Base Salary or Target Bonus other than a one-time reduction that in the aggregate does not exceed 10% that also is applied to substantially all of the Company’s other senior executives, (iii) relocation of Executive’s primary place of business for the performance of his duties to the Company to a location that is more than 30 miles from its location as of the Effective Date, or (iv) any material breach or material violation of a material provision of this Agreement by the Company (or any successor to the Company).

     9. Trading Plan. If the Company’s stock becomes publicly traded, then Executive may elect to establish a trading plan in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934 provided that such trading plan shall be subject to the reasonable approval of the Board of Directors consistent with policies established by the Board applicable to all Section 16 officers.

     10. Indemnification and Insurance. Executive will be covered under the Company’s insurance policies and, subject to applicable law, will be provided indemnification to the maximum extent permitted by Taleo’s bylaws, Certificate of Incorporation, and standard form of Indemnification Agreement, with such insurance coverage and indemnification to be in accordance with Taleo’s standard practices for senior executive officers but on terms no less favorable than provided to any other Company senior executive officer or director.

     11. Confidential Information. During the Employment Term, Executive further agrees to execute any updated versions of the Confidential Information Agreement (any such updated version

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also referred to as the “Confidential Information Agreement”) as may be required of substantially all of the Company’s executive officers.

     12. Assignment. This Agreement will be binding upon and inure to the benefit of (a) the heirs, executors, and legal representatives of Executive upon Executive’s death and (b) any successor of the Company. Any such successor of the Company will be deemed substituted for the Company under the terms of this Agreement for all purposes. For this purpose, “successor” means any person, firm, corporation, or other business entity which at any time, whether by purchase, merger, or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company. None of the rights of Executive to receive any form of compensation payable pursuant to this Agreement may be assigned or transferred except by will or the laws of descent and distribution. Any other attempted assignment, transfer, conveyance, or other disposition of Executive’s right to compensation or other benefits will be null and void.

     13. Notices. All notices, requests, demands, and other communications called for hereunder will be in writing and will be deemed given (a) on the date of delivery if delivered personally, (b) one day after being sent by a well established commercial overnight service, or (c) four days after being mailed by registered or certified mail, return receipt requested, prepaid and addressed to the parties or their successors at the following addresses, or at such other addresses as the parties may later designate in writing:

     14. Severability. If any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable, or void, this Agreement will continue in full force and effect without said provision.

     15. Arbitration.

          (a) General. In consideration of Executive’s service to the Company, its promise to arbitrate all employment related disputes, and Executive’s receipt of the compensation, pay raises, and other benefits paid to Executive by the Company, at present and in the future, Executive agrees that any and all controversies, claims, or disputes with anyone (including the Company and any employee, officer, director, shareholder, or benefit plan of the Company in their capacity as such or otherwise) arising out of, relating to, or resulting from Executive’s service to the Company under this Agreement or otherwise or the termination of Executive’s service with the Company, including any breach of this Agreement, will be subject to binding arbitration under the Arbitration Rules set

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forth in California Code of Civil Procedure Section 1280 through 1294.2, including Section 1283.05 (the “Rules”) and pursuant to California law. Disputes which Executive agrees to arbitrate, and thereby agrees to waive any right to a trial by jury, include any statutory claims under state or federal law, including, but not limited to, claims under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act of 1990, the Age Discrimination in Employment Act of 1967, the Older Workers Benefit Protection Act, the California Fair Employment and Housing Act, the California Labor Code, claims of harassment, discrimination, or wrongful termination, and any statutory claims. Executive further understands that this Agreement to arbitrate also applies to any disputes that the Company may have with Executive.

          (b) Procedure. Executive agrees that any arbitration will be administered by the American Arbitration Association (“AAA”) and that a neutral arbitrator will be selected in a manner consistent with its National Rules for the Resolution of Employment Disputes. The arbitration proceedings will be held in San Francisco County, California and will allow for discovery according to the rules set forth in the National Rules for the Resolution of Employment Disputes or California Code of Civil Procedure. Executive agrees that the arbitrator will have the power to decide any motions brought by any party to the arbitration, including motions for summary judgment and/or adjudication and motions to dismiss and demurrers, prior to any arbitration hearing. Executive agrees that the arbitrator will issue a written decision on the merits. Executive understands the Company will pay for any administrative or hearing fees charged by the arbitrator or AAA except that Executive will pay the first $200.00 of any filing fees associated with any arbitration Executive initiates. Executive agrees that the arbitrator will administer and conduct any arbitration in a manner consistent with the Rules and that to the extent that the AAA’s National Rules for the Resolution of Employment Disputes conflict with the Rules, the Rules will take precedence.

          (c) Remedy. Except as provided by the Rules, arbitration will be the sole, exclusive, and final remedy for any dispute between Executive and the Company. Accordingly, except as provided for by the Rules, neither Executive nor the Company will be permitted to pursue court action regarding claims that are subject to arbitration. Notwithstanding, the arbitrator will not have the authority to disregard or refuse to enforce any lawful Company policy, and the arbitrator will not order or require the Company to adopt a policy not otherwise required by law which the Company has not adopted.

          (d) Availability of Injunctive Relief. In addition to the right under the Rules to petition the court for provisional relief, Executive agrees that any party also may petition the court for injunctive relief where either party alleges or claims a violation of this Agreement or the Confidentiality Agreement or any other agreement regarding trade secrets, confidential information or nonsolicitation.

          (e) Administrative Relief. Executive understands that this Agreement does not prohibit Executive from pursuing an administrative claim with a local, state, or federal administrative body such as the Department of Fair Employment and Housing, the Equal Employment Opportunity Commission, or the workers’ compensation board. This Agreement does, however, preclude Executive from pursuing court action regarding any such claim.

          (f) Voluntary Nature of Agreement. Executive acknowledges and agrees that Executive is executing this Agreement voluntarily and without any duress or undue influence by the

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Company or anyone else. Executive further acknowledges and agrees that Executive has carefully read this Agreement and that Executive has asked any questions needed for Executive to understand the terms, consequences, and binding effect of this Agreement, including that Executive is waiving Executive’s right to a jury trial. Finally, Executive agrees that Executive has been provided an opportunity to seek the advice of an attorney of Executive’s choice before signing this Agreement.

     16. Integration. This Agreement represents the entire agreement and understanding between the parties as to the subject matter herein and supersedes all prior or contemporaneous agreements whether written or oral. No waiver, alteration, or modification of any of the provisions of this Agreement will be binding unless in a writing that specifically references this Section and is signed by duly authorized representatives of the parties hereto.

     17. Waiver of Breach. The waiver of a breach of any term or provision of this Agreement, which must be in writing, will not operate as or be construed to be a waiver of any other previous or subsequent breach of this Agreement.

     18. Survival. The Confidential Information Agreement, the Company’s and Executive’s responsibilities under Sections 6, 7, 10, 11, 13 and 15 will survive the termination of this Agreement.

     19. Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.

     20. Tax Withholding. All payments made pursuant to this Agreement will be subject to withholding of applicable taxes.

     21. Governing Law. This Agreement will be governed by the laws of the State of California (with the exception of its conflict of laws provisions).

     22. Acknowledgment. Executive acknowledges that he has had the opportunity to discuss this matter with and obtain advice from his private attorney, has had sufficient time to, and has carefully read and fully understands all the provisions of this Agreement, and is knowingly and voluntarily entering into this Agreement.

     23. Counterparts. This Agreement may be executed in counterparts, and each counterpart will have the same force and effect as an original and will constitute an effective, binding agreement on the part of each of the undersigned.

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     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by a duly authorized officer, as of the day and year written below.

COMPANY:

TALEO CORPORATION

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