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I've always heard they don't hold up in the State of Texas, but it can be costly to get to the point of a judge ruling on it.
Here's a situation. Company hires a new employee four months ago. They asked him to sign a no compete last week. It was never mentioned in the hiring process. He had 3 interviews, nobody said a word. About a month after he starts, a highly valued employee left the company to go to a competitor (not even in a sales position). Company gets pissed. New policy requires no compete to be signed. Admin Asst says this is due to two recent employees that left (true), and that the Exec staff is trying to protect the company, which I can understand. The problem is the timeline. The second person that left, was still there when they hired him. So the new policy wasn't a policy until after he was hired. The other issue is the terms of the no compete. 2 years, and the way it's written, he basically would have to completely leave his industry for that 2 year period. It also states for any reason. he could get fired, and be bound to the no compete. In my industry, these are becoming more common. But they are typically 6 months to a year, and very specific. If you leave on your own terms, and go to a direct competitor, or they involve certain accounts. I have yet to see one that involves getting fired. It is always if you choose to leave on your own. But you could take a factory position, or another position in the distribution channel that is not direct competition.
I don't think he should sign it. For many reasons. i try to never say never, but the only way I can see myself signing one, is if i built the business and sold it, with an agreement to work for the company for a predetermined amount of time after the completion of the sale. I'd pack my shit and tell them to fuck themselves. But this isn't me. He doesn't have the leverage I do, as it's a new job, but more of a career. By signing it, he's really fucking himself if he wanted to stay in this field.
Thoughts? Opinions?
Here's a situation. Company hires a new employee four months ago. They asked him to sign a no compete last week. It was never mentioned in the hiring process. He had 3 interviews, nobody said a word. About a month after he starts, a highly valued employee left the company to go to a competitor (not even in a sales position). Company gets pissed. New policy requires no compete to be signed. Admin Asst says this is due to two recent employees that left (true), and that the Exec staff is trying to protect the company, which I can understand. The problem is the timeline. The second person that left, was still there when they hired him. So the new policy wasn't a policy until after he was hired. The other issue is the terms of the no compete. 2 years, and the way it's written, he basically would have to completely leave his industry for that 2 year period. It also states for any reason. he could get fired, and be bound to the no compete. In my industry, these are becoming more common. But they are typically 6 months to a year, and very specific. If you leave on your own terms, and go to a direct competitor, or they involve certain accounts. I have yet to see one that involves getting fired. It is always if you choose to leave on your own. But you could take a factory position, or another position in the distribution channel that is not direct competition.
I don't think he should sign it. For many reasons. i try to never say never, but the only way I can see myself signing one, is if i built the business and sold it, with an agreement to work for the company for a predetermined amount of time after the completion of the sale. I'd pack my shit and tell them to fuck themselves. But this isn't me. He doesn't have the leverage I do, as it's a new job, but more of a career. By signing it, he's really fucking himself if he wanted to stay in this field.
Thoughts? Opinions?
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