In an article published on May 7, 2019 for MarketWatch, Patrick Causey offers insight for employees when faced with a non-compete agreement and tips for negotiating the contract before signing.
Non-compete and non-solicitation agreements are designed to protect employers from future competition brought on by a former employee. Because roughly 30 million U.S. workers are bound by these agreements, knowing the pain points and key aspects to consider could potentially save the employee from obstacles down the road when moving to another company.
While non-compete agreements and non-solicitation agreements differ slightly, the spread of the agreements in the U.S. encourages employees to understand their rights. With state regulations on the agreements varying, Causey offers these six general tips to follow:
1. Read the contract: Contrary to popular belief, non-competes are enforceable in most states, so employees should be sure to read the contract thoroughly and consult with an attorney if something is not entirely clear. For example, some agreements could require an employee to move out of state to find a new job.
2. Negotiate the non-compete: Do not be afraid to negotiate terms to narrow restrictions on the ability to find a new job. Look at the geographic scope, the length of the agreement to avoid long-term limitations in the job market and the scope of the competition prohibited.
3. Don’t agree to pay your employer’s attorney fees: Employees should look out for contractual provisions that require them to pay the employer’s attorney’s fees in the event the employer sues for violation of a non-compete. Employees should ask the employer to remove this provision from the contract, or at least request that the clause is changed to a mutual prevailing part attorney’s fee provision wherein whoever wins is entitled to their attorney fees being paid by the other side.
4. Put everything in the contract: Nearly any employment contract contains an “integration clause,” stating the written copy is the entirety of the agreement and any other verbal / oral agreements between parties not included are considered void.
5. Don’t swipe the customer list: No matter how well an employee thinks they have covered their tracks, an employer may recruit a computer forensic expert to examine the employee’s computer to determine if any information has been taken.
6. Be mindful of social media activity: Some employers have begun to sue over a former employee’s use of social media, particularly on LinkedIn. Whether the interactions are generic and non-soliciting or “blatant sales pitches,” it is better to “err on the side of caution and avoid sending direct or targeted messages to customers or former work colleagues about your new job, whether on social media or otherwise.”
