Background Image

Tribology and Lubrication Technology November 2013 : Page 100

1. What is the legality and enforceability of the agreement? Generally the less restrictive the agreement, the more likely it is to be legal and enforceable. Most courts en-force non-competes when an employer has legitimate interests to protect, although these interests are bal-anced against potential monetary effect on the em-ployee. Depending upon the state, a non-compete is usually enforceable if: • Restrictions are reasonable in terms of geography, business scope and time duration (typically six months to two years) and will not interfere with the employee’s ability to make a living. • The employee leaves voluntarily or is terminated with cause. • Financial consideration is given as fair exchange (in the case of existing employees). • The employee is given reasonable time to consider signing. • The employer has not undermined its enforcement ability (e.g., “selective enforcement,” overly broad use of non-competes, asking an employee to con-duct illegal activities, breaching a separate contract or payment obligation with the employee, not tell-ing a new employee about the agreement until after he quits a job). • The employee’s role has not changed materially since signing the agreement. • There is a proper assignment clause to the acquirer when a business is acquired. • It is consistent with public interest. • It is signed by employer and employee. 2. Will you be in violation of any agreement terms? Consult an attorney when considering joining a new employer, and it is unclear if you will be in violation of a non-compete. Minimize risk exposure by “walking a fine line” and avoiding blatant violation of agreement terms. 3. Is your current/recent employer likely to take legal ac-tion? Employers begin in your exit interview by re-minding you about employment restrictions in your non-compete. If you join a competitor and your past employer sees significant monetary damages as a re-sult, they will start with cease and desist letters, pos-sibly followed by filing a lawsuit beginning with a pre-liminary injunction request. Your past employer will likely pursue legal action only if (1.) all other avenues for relief are exhausted and (2.) there is a good chance of winning in court. Employers ideally want to avoid spending time and money involved in a lawsuit. 4. Are you able to negotiate agreement terms with your cur-rent/recent employer? If you are on good terms with the employer for which you possess a current non-compete agreement, you should, at least, be able to clarify what this employer is restricting you from do-ing (e.g., companies you can work for, customers you can call on, products you can sell). Ideally negotiate such agreement terms and get approval to perform de-sired duties with a new employer. Have specific ap-proved competitors and duties listed, and get every-thing in writing. During my 36 years in the search profession, I have seen only a few cases involving non-compete agreement viola-tions go to court. Any disagreements are normally settled directly between two parties. Don’t let a non-compete agree-ment stand in the way of fair competition and you making a successful living. Ken Pelczarski is owner and founder of Pelichem Associates, a Chicago-based search firm established in 1985 and specializing in the lubricants industry. You can reach Ken at (630) 960-1940 or at pelichem@aol.com. 100 • NO VEMBER 2 013 TRIBOL OG Y & L UBRIC A TION TE CHNOL OG Y WWW .S TLE. OR G

Acme-Hardesty Co.

Using a screen reader? Click Here