Stop Sign: How to Handle Non-Competes and Other Restrictions When Changing Jobs

Learning Objectives

• To evaluate a restrictive covenant, including a non-compete agreement, before accepting a job offer or before signing a new agreement with your existing employer. 
• To identify the key types of restrictive covenants, more than just non-compete agreements that can affect your ability to earn a living or change jobs in the future. 
• To examine your options when you have a restrictive covenant agreement and want to change jobs.
• To review what types of non-compete provisions and other restrictions you can enforce as an employer or business owner.
• To discuss as an employer or business owner what you need to ask prospective employees about any restrictive covenants they signed that could affect their ability to work for your business.
• To explore the trends in the law disfavoring restrictive covenants and what to expect in the future.

Course Description

When we receive a job offer and are excited to accept, we don’t always pay attention to the restrictive covenants that could impact our ability to change jobs in the future. 

Restrictive covenants are often a condition of new employment or can be presented to existing employees after they are already on the job.  They can also be required of independent contractors.  The most commonly known restriction – a Non-Compete Agreement – limits departing workers from taking a job with or owning an interest in a business that is in the same industry as our current job. Regardless of whether we work as an employee or independently, restrictions can limit our ability to move on to new positions.

Covenants can take many forms, usually in the following categories:

• Confidentiality
• Non-Competition
• Non-Solicitation of Customers and Other Business Partners
• Non-Solicitation of Employees
• Non-Disparagement

Restrictive covenants usually restrain workers for a set period (often years) from working in a certain type of business within a specified geographic region (that can be narrow or broad).  Whether these restrictions can be enforced, where they can be enforced, and other consequences are important issues we need to consider before limiting our options to earn a living.  We also need to consider them before accepting a new position.  

There are serious considerations for employers and business owners who want to bind workers to these restrictions at the outset, after hiring, or when the employee leaves.  Employers also need to consider whether a potential hire is subject to restrictive covenants that will be broken if the new hire joins the company.  Everyone involved in these situations should be aware of their rights and responsibilities to avoid being dragged into court and facing legal consequences.

Join this CPE Business Law webinar, if you are a business owner or manager, you need to understand the issues related to restrictive covenants so that you do not find your business on the wrong side of the equation.

Overview

• Why is this important?

  5 mins
• The rights and responsibilities for employees and employers

  11 mins
• What employees should consider if subject to restrictive covenants

  22 mins
• Are your restrictive covenants enforceable?

  31 mins
• Case study: Importance of communication

  42 mins