Negotiating Non-Compete Clauses With Your New Employer

Hire a lawyer for your business - 43443400

You have a special set of skills. That is why you have been so heavily recruited by companies in your field. There is a great deal at stake for you and for them in an employment agreement. The company you would like to work for may ask you to sign a non-compete agreement. If you sign the latter, you will agree to refrain from working for competitors, starting your own business in the same industry, or doing any work at all in the industry for a certain amount of time after you leave your employer. Signing this contract can even affect your ability to join another company. If another company shows interest in hiring you, they may insist that you obtain a written release form from your current employer. This is done to minimize the risk of litigation.

Non-compete agreements are a standard employment practice in certain industries. They are designed to balance the employer’s legitimate business interests with your right to make use of your knowledge and skill wherever you see fit. Companies that rely on the professional expertise, the specialized training, or the fame and notoriety of employees to do business often ask new recruits to sign these agreements. However, the specific terms and conditions of a non-compete must be reasonably necessary to protect relationships with existing clients or the goodwill associated with current business relationships.

You have the right to review the contents of the agreement. You also have the right to negotiate the terms and conditions. If you bring a skill set that cannot be found elsewhere, you will find that most companies are open to making reasonable concessions and adjustments. You should not attempt to negotiate an agreement on your own. You should employ a non-compete lawyer in Florida to do it on your behalf.

What Will a Court Think?

You have leverage in the negotiations. Your attorney will view the document from the perspective of the law—that is, a court of law. If you were to litigate the agreement in court, your employer must demonstrate that the document makes reasonable demands. To assess such reasonableness, the court will ask the following questions:

  • Is the company protecting a legitimate interest?
  • What is the geographic scope of the restriction?
  • Does the restriction prevent you from making a living if you leave the company?
  • How long is the agreement in force?
  • Did the employer provide you with additional compensation in exchange for your signature?
  • Are you guaranteed an adequate severance package in exchange for your signature?

Non-compete agreements cannot be instruments of arbitrary power and control over your professional life. An employer has to provide good reasons for insisting on such agreements. For example, if you host a television show and you build up a large audience using the platform provided to you by the broadcaster, it is reasonable for them to want to stop you from taking that audience to another company. The same goes for more mundane products and industries. If you work for a company that hired you to handle its most important accounts, then they will want to keep you from taking those customers with you if you decide to join another company.

A Reasonable Duration of Time

The court considers reasonable duration as the time period in which the information you possess has value. Although lifetime bans have been authorized in certain circumstances, the court will in general look at the protectable interests of your employer. A company cannot stop you from using your general knowledge of the industry to further your career. However, it can stop you from leveraging your insights into a client-based situation that is time limited.

As far as the protectable interests of your employer, the court will look at the following factors:

  • The kind of work you do
  • The length of time you were with the company
  • Whether you received any special training on the job
  • Whether you were briefed on trade secrets and confidential information
  • Any information and data that you were given to help you do your job is the property of your employer, and it cannot be used to further the interests of another company.

Getting Compensated For Your Signature

One of the things you should fight hard for is compensation. There is no rule or law that requires your employer to pay you extra for signing the contract, but it is reasonable for you to demand such payment. When you join a new company, you take a risk. There are no guarantees on whether you will be able to stay on the job. It is right for you to demand a little extra financial security in the event that you do have to sever your relationship.

Your lawyer will also help you negotiate a contingency severance package. It is best to have the guarantee of a certain amount of money and benefits in writing in exchange for your signature on the non-compete agreement.

Additional Issues

It is legal for your employer to ask you to sign a non-compete after you have already started working for them. However, you still have room for negotiation. You cannot be coerced or pressured into signing such an agreement without reviewing it carefully. If you are fired for refusing to sign, then you can challenge this decision in court. In some instances, courts have refused to enforce non-compete agreements signed by people after they were hired.

If you were fired from your job, the non-compete may not be enforceable. It all depends on the reason for your termination. If you can prove that discrimination, retaliation for whistleblowing, or other employer misconduct led to your termination, most courts will not enforce the agreement. However, if your own shortcomings and misconduct was behind the termination, then you will be forced to honor the terms of the agreement.

Things to Keep in Mind

As was said in the beginning, the purpose of a non-compete agreement is to protect the legitimate interests of your employer. If you have never had to sign such a document before, it may seem intimidating. It may seem as though your employer can make or break your career. This is simply not the case. Courts are reluctant to enforce any contract that keeps employees from making a living after they have left the company. The thing to keep in mind is that your employer cannot prevent you from using the knowledge, skill, expertise you have acquired on your own. They can only prevent you from using information they have imparted to you or resources they have given you to make them money.

A non-compete agreement should not discourage you from seeking employment elsewhere if you are not happy with your job. You should also keep in mind that you can quit if your employer has asked you to engage in illegal activity. If you can prove that this has occurred, then the court will not enforce the agreement.

Finally, before you sign any document, you should have it looked at by a lawyer. No non-compete agreement is straightforward. There are clauses and phrases whose meaning can only be discerned by a trained legal eye. To avoid getting trapped in an agreement that can prevent you from making a living, you should consult with a Florida non-compete lawyer. Such a lawyer will help you negotiate a deal that is reasonable and fair, and that gives you the financial security you need.

Interesting Related Article: “ISO 9001: What Are The Basic Requirements And Standards?