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Per my previous post, my company let me go last week.

A few of the folks in my network that I have reached out to are customers of my previous employer. I did not directly solicit them; I merely sent a brief note to make them aware that I was on the market and looking for a job, and asked them to pass my contact information along to anyone that they know that may be looking for someone like me.

My previous employer got wind of this and contacted me to inform me that I am still bound by my non-compete, and basically asked me stop talking to their customers.

I've done a little bit of research and have discovered that courts are usually VERY hesistant on act on non-competes, especially when the employee was terminated, unless the former employer can show undeniable evidence that their business has been irreversible harmed by the former employees actions.

Does anyone have any thoughts or experience in this area?

cwatine's picture

I don't know in the States, but in France, you can't attack an employee for non compete if you don't pay him money for it. Having it just as a clause in the contract is not enough.
The money paid must be at least 30% of the wage of the employee, and the non-compete clause must be limited in time and distance (you can't say "France", or "Europe" !).
And, even in that cas, the company has to clearly prove it was a non compete case.

Did you get any money for you non compete clause ?

akinsgre's picture

I've had this exact thing happen.

First, there is a lot of gray area in this type of case.

I discussed my situation with a lawyer, and if you want to pursue this, you should do the same.

My lawyer advised me to call my ex-employer and talk about what I was trying to do.

If it was really a mis-understanding, that's probably enough.

If you are, in fact, trying to steal their customers, then think long and hard if it's worth the legal wrangling that might ensue.

They don't necessarily have to have the law behind them to make your life miserable.

kklogic's picture

I signed one for my current job. My understanding is also that they rarely hold up in court. I've heard of some people negotiating with their new employer that they'll pay any legal fees that result from them hiring someone with a non-compete.

Best of luck to you on your search.

jhack's picture

Definitely talk to a lawyer. Some states treat them as France does: non-enforceable.

John

AManagerTool's picture

My lawyer in New Jersey advised me that they would have to prove damages from your being hired by their customer/competitor. He told me that in 95% of the cases, they can't. He also told me that in most if not all of the cases the judges refuse to hear them because it effectively serves as a barrier to future employment. They can rattle their sabres but usually it's more of a pen knife.

They laid you off. They have no right to deny you a living.

HMac's picture

US State laws vary. The ONE thing you need to understand first, is under which State's laws your former employer will operate reagrding employment issues. This can make a difference to you, and to how much flexibility you have.

In my experience (that would be from reading my own employment agreement...), the agreement states itself which State's laws under which your employer is operating. Check it out.

Then, spend a couple of hundred bucks to consult an employment attorney who's familiar with the laws in your State, and in your former employer's State, if that's different.

Do this before contacting your former employer.

This is important, jclishe. Lots of people have opinions (me included!). But the opinions that count are those who know the law as it pertains to your individual circumstances.

Sorry you were let go. Other doors will open.

-Hugh

MsSunshine's picture

Bottom line: The new company you want to go to may respect the non-compete even if the legal system doesn't.

You need to be careful with this even if legally it won't hold up in court. I know of several people where the hiring company did not hire the person after they found out the person had signed a non-compete. The reason given was that the person had willingly (or had no evidence to the contrary) signed the non-compete and was going back on his word. The companies did not want a person who did not keep his commitments.

In that case, you can try to prove that you did not sign it willingly. That is harder to prove. In the case of my company, they only give them to you a new hire or as a condition with a promotion. Therefore, you could choose not to sign and not take the job or the promotion. But the company can say that you did it willingly because there was no risk that you would lose your job by not signing.

Note that these were all cases where the person quit - not that the were fired/laid off. I would think that would be different.

bflynn's picture

The danger of non-compete agreements is that they are a means of your former company controlling you EVEN when you're not in violation of them.

If all you were doing was asking for future job references or leads from personal acquaintances, it sounds like you are clearly covered. You are not soliciting business, you are not competing with them. But being right will not prevent your former company from pulling you into court if they choose to.

There is one area that you could run foul of. If your former company contracts with these customers and if you becoming employed by the customer would result in less business for your former company, then you could be considered to be in competition and in violation of the agreement. Internal competition is still competition.

Bottom line - take the actions to be effective, not to be right. Talk to your lawyer and get his advice about the situation. I can't give anything past that.

Brian

jclishe's picture

Thanks for all the tips and advice on this, everyone.

The bottom line is that I was only contacting my professional relationships (some of which are clients of my former employer) and asking them to forward my contact info to anyone they know of that may be hiring. I was not directly soliciting anyone nor trying to steal business from my former employer.

When I started at this company 5 years ago I was a senior technical consultant, and over the past 5 years I had been promoted all the way to regional manager with 20 direct reports and owning the P&L for an entire region. I have been the model of a good corporate citizen for them and it definitely upsets me that they're giving me a hard time about this now. I have not done anything to attempt to take business from them.

And you want to hear the worst part? This will make any MT listener cringe:

I was recently shifted under a different manager, as was the rest of my team. But the org was flattened as a result of our recent acquisition in order to reduce the number of managers we had, so a few weeks before I was let go I was actually demoted and became peers with my former team, and we all reported to this new manager. Let's call him Bob. So Bob is about 10 years older than me and supposedly was a CIO at a former employer. So you would certainly expect that he should at least have a clue about how to manage people.

The day that I was let go, I had taken a vacation day. I was at home in the morning, and was online getting a few things done before I left the house to enjoy my day off. I had been connected to our corporate network since about 630am, and then around 930am I could no longer access anything. Keep in mind that I'm technical so after some basic troubleshooting I could tell that my account had been disabled. I called someone in HR, who told me that I needed to contacted Bob. So I called Bob and he said "oh yeah, I was just about to call you. You're an at will employee and I want to thank you for your services but you're no longer needed. Please return your laptop and key to me as soon as possible."

So after 5 years of employment, I was terminated on my day off, over the phone, and *I* found out on my own due to issues with my account and *I* had to call around to find out what was going on. Tell me that isn't the definition of piss-poor management.

And just for the sake of comparison, about 2 months ago I had to let someone go that was working in a remote office about 6 hours away from my office, and I told my then-manager (not Bob) that I needed to drive to the remote office in order to do the termination face to face. So here I drove 12 hours round trip just to perform a termination "the right way", and Bob can't even do mine face to face.

But that said, there is light at the end of the tunnel. One of my former clients did in fact know of an IT consulting company that is hiring, in Charlotte, NC (I'm in Cincinnati). My former client forwarded my contact info to the guys in Charlotte, along with a recommendation for me. They contacted me for a phone interview Thursday afternoon, and then Friday morning they called back to see if I could be in Charlotte on Monday for face to face interviews. All the arrangements have been made and I'm set to meet with them F2F on Monday.

Better yet, the company in Charlotte is currently working with another one of my former clients in Michigan. I contacted a guy I know at my former client in Michigan and he told me that he talks with the CEO of the consulting company several times per week, so he contacted him on Friday to put in a good word for me. So not only did I impress the hiring manager on the phone Thursday, but I have 2 former clients that have called these guys on my behalf and put in a good word for me.

This would be an amazing position and their model is that they have consultants spread throughout the country so when I wasn't visiting a customer, I'd be working from home. Not only do I not need to relocate to Charlotte, but I wouldn't even have an office to commute to anymore!

Wish me luck!

Jason

jhack's picture

Thanks for sharing the story, and....

Good Luck!

John

HMac's picture

Good luck on Monday. And even though you gave that company five years of your professional life, it sounds like a place you're better off leaving behind you!

-Hugh

US41's picture

I'm not a lawyer, but I would definitely ignore the former employer. He fired you. You're a free man. I have never heard of anyone being successfully run to ground using non-compete. He's just being vindictive. Sounds like he did you a favor by letting you go.

The law may disagree. A lawyer might scream "Risk! Risk!" if they read this. Some managers might be horrified. I'm sure there are anecdotes of people being caught on non-competes.

I don't care. I say ignore him and take the job if you want it. Maybe he will sue you and spend thousands of dollars trying to stop them from hiring you. But I really doubt it.

Life is to be lived - not feared.

HMac's picture

Nobody can stop you from staying in touch with customers of your former employer. And using those contacts to try to find work should be of no problem under any State's laws.

Here's what I've learned based on my own experiences during the past several months:

The issue about non-competes is the former employer's legitimate right to protect proprietary information that you learned during your time as their employee. Whether it's about costs, pricing, strategy, financial performance - whatever - you can't share it for some proscribed period of time (ex: a year from your date of separation).

So employers are often more concerned about former employees contacting competitors than they are about former employees contacting customers.

Don't do anything that would represent "unfair" competition - anything that would cause monetary damage to your former employer by sharing or misusing information that your former employer has a legitimate right to protect.

Here are two links to online resources regarding employment law:

http://www.myemploymentlawyer.com

http://www.workplacefairness.org

You can hunt around for non-competes - a lot of information is there.

-Hugh