Category: Post-Employment Restrictive Covenants

Quirky Question #226,  One-Size-Fits-All National Non-Compete?

Quirky Question #226, One-Size-Fits-All National Non-Compete?

Question: We are a business headquartered in Minnesota.  We plan to expand into other states but have concerns with investing the time and money in training new employees in a very competitive industry.  We currently have our Minnesota employees sign a form non-compete agreement.  Can we use that same form agreement for other states where we are expanding?

Quirky Question #212, Montana Non-Competes

Quirky Question #212, Montana Non-Competes

Question: We are an accounting firm and recently fired an employee at will.  We have always understood that Montana law disfavors non-competition agreements, therefore, our employment agreement provides that if the accountant provides services to our clients within six months of leaving, he will pay us the profits from such an engagement which are stipulated to be 75% of gross...

No Poaching Allowed: Antitrust Issues in Labor Markets

No Poaching Allowed: Antitrust Issues in Labor Markets

The article below addresses another aspect of employees moving from one company to another — agreements between two or more competitive corporations not to solicit, or hire, each other’s employees.  The article below first appeared in Antitrust, Vol. 26, No. 3, Summer 2012. © 2012 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion...

Quirky Question # 197, Successor Company’s Right to Enforce Non-Compete

Quirky Question # 197, Successor Company’s Right to Enforce Non-Compete

Question: We recently acquired a small company. We felt it would be a good fit for our considerably larger enterprise in part because we picked up a geographic sales territory in the Midwest that we previously were not covering very effectively. We did not spend a ton of time scrutinizing the key employees’ contracts as part of our due diligence...

Quirky Question # 195, Uniform Policies for Nationwide Employer — Which State’s Law Applies?

Quirky Question # 195, Uniform Policies for Nationwide Employer — Which State’s Law Applies?

Question: Our company does business in all 50 states. To the greatest extent possible, we like to have uniform employment policies for our employees, wherever they may be located. As you know, this goal is frustrated somewhat by the differences among state employment laws. We have been considering using a standard employment agreement for all of our exempt employees. Our...

Quirky Question # 188, Enforcing Non-Solicitation Agreements

Quirky Question # 188, Enforcing Non-Solicitation Agreements

Question: Like many companies, we are in a highly competitive industry.  We spend a lot of time training our sales employees to perform their jobs, at a considerable expense to our company.  Consequently, we have all of our sales personnel execute a non-compete/non-solicitation agreement at the commencement of their employment. Several of our employees have joined a company that we...

Quirky Question # 179 – Restrictive Covenants in an Expired Term Contract

Quirky Question # 179 – Restrictive Covenants in an Expired Term Contract

Question: Our company has a sales force composed of individuals located throughout the U.S.  When we hire sales employees, we use a term employment agreement, typically of three years’ duration.  Our employment contracts include post-employment restrictive covenants, the most important of which are non-competes and non-solicits with respect to our customers.  Each restrictive covenant last two years. We try to...

Quirky Question # 164; Who Owns Employees’ Ideas?

Quirky Question # 164; Who Owns Employees’ Ideas?

Question: One of our employees recently left our company and joined one of our competitors. He did not have a non-compete (we are located in a state that rejects non-competes). But, he did have an inventions assignment agreement.  He took some very clever ideas to one of our competitors, which promptly hired him. The competitor began working on his ideas...

Quirky Question # 160: Non-Competes and Public Policy

Quirky Question # 160: Non-Competes and Public Policy

Question: We are a nationwide company with offices and employees in nearly every state. One of our primary growth areas is California. We understand that California courts are generally inhospitable to post-employment restrictive covenants, including non-competes. But, we are trying to have uniform policies throughout our organization. Consequently, we still have confidentiality and non-compete language in our employees’ contracts, even...

Quirky Question # 159, Non-Competes and Choice of Law Provisions

Quirky Question # 159, Non-Competes and Choice of Law Provisions

Question: Our company’s headquarters is located in Seattle, Washington.  We want to hire someone to start up our company’s new location in another state.  Because of the competitiveness of our industry, we would like our new employee to sign a non-compete agreement applying Washington law.  Although we are familiar with the non-compete laws in Washington, we are unsure what the law...