Non-Competes- Any Experience?

Balloonman

I have an employee we just let go. It turns out he was going to give notice tomorrow, he informed us of this. In his employment agreement he has a no compete clause for 2 years of doing identical work within 50 miles of our location.
He said he read it but did not think that is would be an issue as he is going to work for another company. (DUH) He is going to work for what is most likely a competitor, though he would not name them.
Once the new employer is identified, and it is clear he is in violation of the agreement, I am sure we will move forward.
My question to my fellow formites is has any body dealth with this before, and what were the results?

My $0.02 worth.
DJ The Balloonman

Parabeagle

I'd do a search on HR Hero, because it seems to me that there have been articles and papers on the noncompete issue on this site. I have a very limited background with noncompetes with my previous employer and the only advice I can give you is that whether or not it's enforceable (at least in my part of the country) seems to depend on the judge you get. The definition of an "overly restrictive" noncompete agreement seems to vary widely. Check with your counsel before you commit to filing the lawsuit. It may not be worth the trouble.

Tony Kessler

Beagle is right. If you're an Employment Law Letter subscriber, go behind the password and do a search for "Covenant not to compete" in the state of Missouri. The attorneys who write the Missouri newsletter have covered the issue on several occasions. If you need help or have lost your password, call me at the number below or Customer Service at (800) 274-6774. Good luck. tk

Tony Kessler, director of editorial
M. Lee Smith Publishers LLC
(615) 661-0249 ext. 8068

marc

I have seen several non-compete agreements. It is amazing how different they can be. How tight and specific the language is obviously has a great deal to do with how successful any litigation will be. One entrepreneur I worked for was adamant about going after a key person that went to work for another company, but was persuaded the agreement had significant weaknesses that made winning near impossible. Another had a fairly strict agreement, received similar advice but went forward anyway. He wanted to send a message to a varied audience about not f###ing with him or his company. The litigation was quite expensive and time consuming for both parties. I left the company prior to resolution and never did hear how it turned out - I do know it was very expensive though.

TN HR

Been there, done that, got the T-shirt, and we got our a** handed to us. It was in PA, and the court viewed the non-comp negatively. Since then, my experience has been that depending on the state and court or judge's opinions, you may or may not stand a chance. I know that in TN, you practically would have to leave an employer with customer lists and proprietary information and probably begin soliciting the competition before a judge would hear your case.

Gene

pecohr

I hate to say it but I'm in agreement with TN HR, this is a tough battle to win. The courts look very unfavorably on restricting someones employment opportunities, which is how this would be viewed. A better approach might be to be proactive with anyone he might contact and use your efforts to make sure any customer/s elects to stay with you. IMHO

mwild31

First, how much does this suck: "I have an employee we just let go. It turns out he was going to give notice tomorrow, he informed us of this." This is one of those Homer Simpson moments #-o - I've been here before and wished I could have turned back the hands of time & waited that extra day for the notice (hello unemployment costs). I feel for you.

My experience with non-competes, although limited, is much more favorable than the others. I hate the way this sounds, but the more specific the non-compete is & the closer the job at your company matches the new job & if the employee takes your customers with them - the easier it is. I know our lawyer friends will hate me for this, but it also helps to apply pressure from your attorney as well. In my case, we sent a letter from our attorney immediately after the person left & reminded the person about the non-compete and included the signed copy. May sound like bully tactics - but it was important to our company's livelihood that we proceed. Sorry PORK, but DJ - I would contact your attorney & put together a game plan.

Shadowfax

I agree with MWild. If the agreement is tight (reasonable as to activity, geography and time) it is enforceable, at least in Mi. Mi refused to recognize non-competes until relatively recently, so they are scrutinized closely, and, the activity of the former employee must be proven clearly. I don't know about Mo, but Mi has also passed a uniform trade secrets act. It covers everyone, regardless of whether there is a non compete or not from using proprietary and confidential information from a former employer. If Mo has passed the act, it may be more useful to you than the agreemetn, depending on what the former emp/ee is doing.

Balloonman

A twist............
The employee had a company truck, term went fairly well, but he would not say who he was working for. Well his manager rode over to his house with him so he could empty the truck and then drive it back..........
After pulling in the driveway, a neighbor walks out who knows the ex-employee's boss they chat, the ex-employee gets pale and says "You know Bob?" Yeah we are old friends..... turns out that is who he is going to work for............LOL It is a small world...............after all of the not wanting to tell who he is going to work for, and the oh you will find out, I thought that was hilarious!!!!!!!
The non-compete was discussed again, with specific mention of not coming after our customers or we would have to take legal action, the new boss said, don't blame you, I would too.
My $0.02 worth.
DJ The Balloonman