New job: Non-Compete seems VERY restrictive ???
 

So I remember threads from a while ago discussing overly restrictive non-compete agreements, and I'm checking to make sure the consensus is still the same, and to make sure that I'm reading this right. After reading the "Follow the money" thread, I've gone and found new job -- promotion, pay raise, more responsibility and the promise of growth. I'm pretty excited, but the non-compete's a killer. Check this out:

I agree that for a period of my employment by the Company and for one year after the date my employment by the Company ends for any reason, I will not, either directly or indirectly, provide work for any customers of the Company with whom I worked with or had personal contact directly as a result of my employment with the Company. Customers shall include, but not be limited to, the United States Government.

I'm totally ok with not joining their competitors or starting a competing business. But the USG is the single largest employer (directly or indirectly) in this region. If I agree to this, it seems like I'm cutting myself off from virtually any employment in the DC area for a year after I leave this company. Am I nuts? Is there a simple way to modify the text to make it more reasonable?


The second bit that bugs me is the "Duty of Loyalty" clause. It reads:

I understand that my employment with the Company requires my full attention and effort. I agree that during the period of my employment by the Company I will not, without the Company's express written consent, engage in any employment or business activity other than for the Company, including but not limited to employment or business activity which is competitive with, or would otherwise conflict with, my employment by the Company.

In principle, it's ok. But I do a number of small business things on the side. For example, I do some photography on the side -- I shoot the occasional wedding, do portraits for people, shoot events, and I sell the prints. It isn't a big money maker, but it looks like if I do this, I need to get express written consent for it. Same for, say, building iPhone apps on the side, or any similar minor venture. The simple modification seems to be to change the last line like this:

[i]...engage in any employment or business activity other than for the Company, including and limited to employment or business activity which is competitive with, or would otherwise conflict with, my employment by the Company.

The final thing that just seems odd is that the agreement has a host of items regarding Inventions, patents, and the like. But this is a services/consulting group, not a research group. They don't do any inventing, nobody has any patents, etc.


I'm thinking I'll just raise these concerns directly to my new employer and suggest modifications that make the text more reasonable. Is that a mistake? Is there a better approach?

Thanks,
Dan

Even if they did work in creative ways, any patentable inventions you come up with during your employment are their property.

AFA photography, etc., it seems simple enough, declare your intentions and let them note them. Get a copy as that would seem to imply consent.

The biggie looks to be the diddy about the USG. You could want to provide photography services to the USG during of after employment. Since that would seem to be not of interest to your new employer, maybe you should explore that with them gently.

I would make a point of telling your new employer that you don't spend a LOT of time photographing in order to demonstrate that you are not overburdened with outside commitments, but that you do accept earnings when appropriate.

Depends on how much you want this job. I started a thread on this last year and I think the consensus was that no court will bother to enforce a non-compete if you've been laid off or fired, but might if you've left on your own freewill. The joke around my company is that if you go to work for a related business, you have to become a customer of our company. It happens regularly too. But I've never heard of anyone who got canned then going to work for a competitor.

Those are very normal non-compete clauses. Nothing onerous about them. My guess is that you will not be able to negotiate them.

If you are ever in the position where you breach one of those clauses, the onus will be on your former employer to show that the non-compete was reasonable under the circumstances. If the US Govt. really is the only customer/client in your neck of the woods, that will be a difficult onus to discharge.

In other words, I wouldn't worry too much about these clauses.

Seems kind of broad for a non-compete.....meaning you'll have no choice but to relocate after you leave....
I would try writing your own non-compete and see if they agree, maybe shorten it to 6 months, and only if you leave, if they fire you it's void....LOL
In florida non-compete clauses are not legal iirc.....
I never agreed with non-competes, and only signed them in the past if I knew I could get back to work in the same field immediately if I left that job......
I have also turned the ohio non-compete clauses back in NOT signed (these were cases where they were handed to me after I was hired and not discussed beforehand) and never got any grief, but were small private companies.....
I would discuss it carefully with them but be carefull, if done wrong they'll see it as you are planning on not staying with their company long and they could withdrawl the offer.....

non-competes are very state dependent. Some states enforce fairly restrictive ones, other states have statutes making almost every non-compete provision unenforceable. you need an answer specific to your state.

I would not sweat it.

Looks standard to ones I've signed in the past.

Understand the purpose is to protect the company business interests. It has nothing to do with you personally.

The company does not care that you make a few grand on the side here and there.

They don't want you poaching clients or using knowledge you've gained thru employment to your benefit.

It's really not a big deal.

I doubt it's enforceable but check with a lawyer. Otherwise if you don't like it, don't sign it.

Non-competes are a "funny" thing. Here in Oregon, I have heard many attorneys tell me that they are not enforceable. Thing is, I have a number of co-workers who HAVE been forced to comply. I would act as though you will have to comply 100% with the non-compete.

Question: does the job give you one years worth of breathing room so that you could coast for a year while the non-compete runs out?

Ask for one year's unconditional severence?
If they try to force you to be unemployed in your field, then they should pay for it.

I have a friend who went to a competitor (IT support) and got a new job (he signed a non-compete). The competitor knew exactly where he was coming from and asked him to contact old clients. He did and they "stole" a few away from the previous employer.

Previous employer hires a private investigator to follow ex-employee and catch him on video entering clients businesses.

Previous employer files lawsuit and WINS! Not sure what the dollar amount was, but it cost them a few $$$ plus legal fees.

Oops...

Not a lawyer, but I believe at least in CA they can't hold you to it unless they pay you a years severance. Meaning they can't have it both ways. They can't not pay you and have you not make a living at what you know. There is no parity on your side.

Strange business. Seems to me that the consensus is either that (a) agreements like this are only selectively enforced and (b) impossible to enforce to the written limits. So while it says that I can't have the USG as a customer of mine for 1 year after I leave, as long as I don't take their _actual_ customer (a specific subset of NAVSEA, in this case), they probably won't enforce. If they do, a court is unlikely to decide in their favor? Or, if the court does decide in their favor, they are only likely to do so if the company is willing to provide a 1 year severance? Or should I address this up front?

The patent business just seems odd -- this is NOT a patent-filing group. There is no part of my job description that even remotely resembles anything relating to patentable work. It just seems like if I, on my own time, develop a patentable item that is wholly unrelated to my paid job, that should be all mine. Am I crazy?

I really would like this job, I think. It's a big step up in terms of responsibility and pay, so I don't want to rock the boat too much over what is probably just boiler-plate. I just don't feel comfortable, I guess.

Thanks for all the thoughts on the topic.

Dan

depends on the state - but I don't see anything too onerous. Usually there's a "non-compete" and "non-solicitation" clauses. 98% of the time you are fine - if you start calling off customer lists and stealing clients - that's when you bring the heat. A smart company will not go after you - but will go after your new employer for Tortious interference.