Joe the meek
Active Member
Anyone every sign a no compete clause?
Just curious how it was worded.
Just curious how it was worded.
Anyone ever sign a...
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Oh goodie... a two part question.
1) I signed one over 35 years ago
2) I have no idea on it's exact wording because it's so long ago but I do know it was along these lines.... http://www.toronto-employmentlawyer.com/law-advice/non-compete-agreement.php
Sorry I couldn't help more.
1) I signed one over 35 years ago
2) I have no idea on it's exact wording because it's so long ago but I do know it was along these lines.... http://www.toronto-employmentlawyer.com/law-advice/non-compete-agreement.php
Sorry I couldn't help more.
Johnfromokc
Active Member
Never signed one, but I've seen them. The ones I've seen restrict competition with time and distance. I'd be extremely hesitant to sign one. Some are stronger than others.
I'd never allow anyone to restrict where I can do business unless they paid me a satisfactory lump sum in cash to the point it wouldn't matter if I got business in that particular area or not.
I'd run it by an attorney experienced in such matters before I signed in any case.
I'd never allow anyone to restrict where I can do business unless they paid me a satisfactory lump sum in cash to the point it wouldn't matter if I got business in that particular area or not.
I'd run it by an attorney experienced in such matters before I signed in any case.
Joe the meek
Active Member
Send me $50 and well call it even.
Joe the meek
Active Member
That was already in the plan. Just curious how they played out in real life. We were going to hire a guy that had singed one, I was told it wouldn't be a problem to get him out of it, BUT the company had paid for his moving expenses and rent until he relocated which meant a buyout to get him out, which wasn't worth it.
I never had any issues when I left the company and went to work for a competitor because they knew full well that I didn't take any of their " secrets " with me. I have my doubts that a company would limit a ex-employee from making a living providing he / she left on good terms. Then again you Americans sue for damn near anything so I suppose I wouldn't feel very comfortable signing one south of the 49th either.
It's in the mail.
Joe the meek
Active Member
Canadian or US?
John's points are valid. They (no compete clauses) can be restrictive on many things. I was just looking for a "real life" example.
First thing that comes to mind, is you sign one, then of no fault of your own they let you go, then you could be in deep do do (that of course I depends on how the clause is written).
The onus would be on the employee so why would it be something you would worry about? I've also had my moving and other related expenses covered by way of a contract but they have always been a separate issue and not related to the non-compete. They have also been time limited to a year. If I would have terminated my employment before the year was up I would have had to reimburse said employer. Um...... good luck with that.
Johnfromokc
Active Member
Did you read the agreement he signed?
May be worth looking into anyway. Depends on how good the guy is and if it is indeed "direct" competition - the competetion must be an apples-to-apples comparison. Relocation expenses are generally considered paid in full after 1 year. If that is the case, he may be free to do as he wishes.
I'm going across the line in an hour or so and I'll fire off another via fax.
Absolutely they are valid and his comment about not signing one without running it past a mouthpiece prior to signing says it all.
The problem is that there is no such thing as a standard non-compete clause contract.
It's all in the wording and how it was written up.
Until you actually read it, you have no way of gauging how restrictive it is or isn't.
It's all in the wording and how it was written up.
Until you actually read it, you have no way of gauging how restrictive it is or isn't.
Alien Allen
Froggy the Prick
typically the clause is between the employee and the company he is leaving. However there are lots of issues that can crop up that could drag the new employer into a mess. I would make certain what liabilities are involved and would be hesitant to hire a person who has signed such an agreement unless the former company will waive the clause in writing.
Like what?
If two companies are in direct competition with each other in the same market and one of them lure an employee away from the other knowing there was a non compete clause... that company will be dragged into a lawsuit for sure.
Not only that, they may lose the money they invested into bringing this guy on board.
Alien Allen
Froggy the Prick
You forgot
This is the USA we are talking about
One can sue for anything
Think dumb clutz spills coffee on herself at McDonalds and sues for millions
Things went down hill fast when Lawyers were allowed to advertise years ago.
I have signed three while working in spa/salons.
Basically that I will not work with 5miles another spa/salon while employed by said company(one place I worked was 5miles of any of their locations, of which they have 5 across the area), that radius would carry over with termination/quitting for one year supposedly.
I never followed it after leaving somewhere, but they were more concerned with alerting clients and bringing them with you.
Basically that I will not work with 5miles another spa/salon while employed by said company(one place I worked was 5miles of any of their locations, of which they have 5 across the area), that radius would carry over with termination/quitting for one year supposedly.
I never followed it after leaving somewhere, but they were more concerned with alerting clients and bringing them with you.
I have signed them in the past and have hired many people who had them in their contracts back when I was programming radio stations.
While it's true the specific language has a LOT to do with them, here are two key things to consider - from my own personal experiences
1) Most are not very enforceable from a legal standpoint. Many have been nullified by judges in the past, especially when they are strictly there as a clause that states "you can't work within X miles for Y amount of time." However, the addition of some tangible consideration in exchange for the non-compete almost always gives them more teeth. For example, my company often took a small percentage of the base salary in the contract and designated it as "compensation" for the non-compete. So anyone trying to break it would be faced with not just the company restricting the ability to work, but with the fact that you had already been PAID for that time period. It's a loophole, but I've seen in work. It sounds like maybe investment in training and relocation could be construed as that special compensation and add credence to a non-compete.
2) This is most important - the VAST majority of non-competes never see any type of scrutiny in court. It's VERY rare for a dispute to get that far where a judge actually has to rule on it's enforce-ability. What almost always happens is that competitors simply honor and uphold the non-competes in good faith, because they don't want their competitors to try to break THEIR non-competes. So it's a bit of a "gentleman's agreement" situation. There was more than one occasion where a person under a non-compete would come to us for a job, and we'd simply say "we won't talk with you until you're out of that period." So given that scenario - they were very effective, yet rarely "enforced" by a court. Make sense?
While it's true the specific language has a LOT to do with them, here are two key things to consider - from my own personal experiences
1) Most are not very enforceable from a legal standpoint. Many have been nullified by judges in the past, especially when they are strictly there as a clause that states "you can't work within X miles for Y amount of time." However, the addition of some tangible consideration in exchange for the non-compete almost always gives them more teeth. For example, my company often took a small percentage of the base salary in the contract and designated it as "compensation" for the non-compete. So anyone trying to break it would be faced with not just the company restricting the ability to work, but with the fact that you had already been PAID for that time period. It's a loophole, but I've seen in work. It sounds like maybe investment in training and relocation could be construed as that special compensation and add credence to a non-compete.
2) This is most important - the VAST majority of non-competes never see any type of scrutiny in court. It's VERY rare for a dispute to get that far where a judge actually has to rule on it's enforce-ability. What almost always happens is that competitors simply honor and uphold the non-competes in good faith, because they don't want their competitors to try to break THEIR non-competes. So it's a bit of a "gentleman's agreement" situation. There was more than one occasion where a person under a non-compete would come to us for a job, and we'd simply say "we won't talk with you until you're out of that period." So given that scenario - they were very effective, yet rarely "enforced" by a court. Make sense?
Joe the meek
Active Member
Yes. As Tim said, unless you actually read what it says, there can be so many variations that it can be hard to make a generalization.
I understand the implications if a company lured an employee away and knew there was a non compete in effect but if that employee solicited the new employer and didn't mention the clause the onus would be on the employee.
****I'm not a lawyer but the more I think of it the more I would think any lawsuit brought by the ex-employer against the new employer would probably be frivilous. ****
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